September 25, 2015

Former U.S. Army Physician Sentenced to Federal Prison for His Role in an Estimated $7.3 Million Health Care Fraud Scheme

In El Paso today, former William Beaumont Army Medical Center (WBAMC) physician and Army Lt. Col. Richard Craig Rooney of Medina, WA, age 46, was sentenced to 30 months in federal prison for his role in an estimated $7.3 million Health Care fraud scheme announced United States Attorney Richard L. Durbin, Jr.; Janice M. Flores, Special Agent in Charge of the Defense Criminal Investigative Service’s Southwest Field Office, Arlington, TX; Special Agent in Charge Scott Wilk of the Southwest Fraud Field Office of the U.S. Army Criminal Investigation Command Major Procurement Fraud Unit, Arlington, TX; and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

In addition to the prison term, Senior United States District Judge David Briones ordered that Rooney pay a $15,000 fine and be placed on supervised release for a period of three years after completing his prison term.

The Government is also seeking the forfeiture of approximately $4.27 million seized from financial institutions. The Government has already forfeited a residential real estate property located in the State of Washington. A hearing to determine restitution is scheduled for December 1, 2015, before Judge Briones.

On January 9, 2015, Rooney pleaded guilty to aiding and abetting Acts Affecting a Personal Financial Interest. By pleading guilty, Rooney admitted that, beginning in 2005 and continuing through June 2010, he was employed by two medical device development and sales companies, Altiva Corporation (“Altiva”) and Allure Spine Consulting, LLC (“Allure”), as a consultant regarding the efficacy of existing medical devices and the design development and marketing of prospective medical devices. During the time Rooney was receiving money from both Altiva and Allure, he was also recommending that Darnall Army Medical Center at Ft. Hood, TX (DAMC) and WBAMC purchase Altiva and Allure products for his use in surgical procedures at the two hospitals. At the time Rooney was making the decisions to use Altiva and Allure products and was recommending the two military hospitals contract with Altiva and Allure to purchase said products, Rooney had an undisclosed financial interest in Altiva and Allure products.

This investigation was conducted by agents with the Defense Criminal Investigative Service (DCIS); agents of the Criminal Investigation Command Major Procurement Fraud Unit of the U.S. Army Criminal Investigation Command; and agents of the Federal Bureau of Investigation (FBI). Assistant United States Attorneys Debra Kanof and Anna Arreola are prosecuting this case on behalf of the Government.