Durable Medical Equipment Clinic Owner Pleads Guilty in Miami for Role in $11 Million Health Care Fraud Scheme

WASHINGTON—The former owner of a defunct durable medical equipment (DME) clinic based in Miami pleaded guilty today for his role in an $11 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Miami Office made the announcement.

Francisco Enrique Chavez, 36, of Miami, pleaded guilty before U.S. District Judge Patricia A. Seitz in the Southern District of Florida to one count of health care fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on February 11, 2014.

According to court records, Chavez served as the president and sole corporate officer of World Class Medical Clinic Corp. (World Class). From March 27, 2006, through August 22, 2006, Chavez submitted or caused to be submitted approximately $11,303,494 in fraudulent claims to the Medicare program on behalf of World Class for DME that was neither prescribed by a physician nor medically necessary. Medicare paid more than $1,713,959 on these fraudulent claims. The proceeds of the World Class fraud scheme were deposited into corporate bank accounts that were controlled by Chavez, and he made numerous cash withdrawals and deposits into personal and shell entity bank accounts to conceal the nature of the scheme.

Chavez was a fugitive who was extradited from Spain to Miami on August 30, 2013.

This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorneys Allan J. Medina and Sarah M. Hall of the Fraud Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 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.