Health Care Fraud Fugitive Extradited from Colombia to Serve 2006 Sentence

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced the return to South Florida of fugitive Magda Luz Lavin, 55, after her arrest and extradition from Colombia. Lavin fled South Florida during a 2006 health care fraud trial and was subsequently charged with bond jumping. She made her initial appearance in federal court earlier today on the bond jumping charge.

Lavin was the former owner of at least two HIV clinics in the Southern District of Florida. She was charged in a 25-count federal indictment with conspiracy to commit health care fraud, health care fraud, and money laundering. On September 18, 2006, after three weeks of trial before U.S. District Judge Joan A. Lenard, defendant Lavin failed to appear in court, and the court issued a bench warrant for her arrest. Thereafter, the court found that Lavin had fled the jurisdiction and had voluntarily waived her appearance during the remainder of the trial and permitted the government to proceed with the trial. On September 25, 2006, the jury convicted Lavin on all counts.

On December 19, 2006, Judge Lenard sentenced Lavin in absentia to 180 months in prison and ordered her to pay restitution in the amount of $5,037,356. Upon her return, Lavin will begin to serve her sentence and face the bond jumping charges.

U.S. Attorney Wifredo A. Ferrer stated, “This case should serve as a wakeup call to health care fraud defendants who seek to avoid justice by fleeing to other countries: the arm of the law is long, and we in law enforcement are patient. Sooner or later, we will catch you, and you will be brought back to face justice.”

“In 2006, Magda Luz Lavin, a convicted health care fraudster, attempted to cheat justice by fleeing the country during her trial,” said Michael B. Steinbach, Special Agent in Charge of FBI Miami. “Thanks to the support and close cooperation of our partners including Interpol and the Colombian National Police, she is again in the United States in federal custody. Justice is served.”

According to the evidence, the defendant used two medical clinics, Alternative Day Spa Corp., formerly in Kendall, and Alternative Treatment Programs, formerly in Key West, to defraud Medicare of more than $5 million between May 2000 and December 2002. The two clinics claimed to specialize in the treatment of HIV patients with “infusion therapy treatments.” The patients who attended the clinics were, in fact, HIV positive.

The evidence at trial showed that under Lavin’s direction, the clinics fraudulently billed Medicare for dosages of two expensive medications, Neupogen and Procrit. In fact, however, the patients received either no medication at all or minimal dosages of the medications diluted with vitamins and saline solution or dextrose solution. Lavin also paid kickbacks to patients to induce them to continue to attend the clinics.

During the trial, the evidence revealed that the defendants had caused the falsification of progress notes on “infusion therapy sheets” in the patients’ files to make it appear that the patients were receiving medications as billed to Medicare. In truth, however, patients were not receiving the medications as noted on the sheets and billed to Medicare. In addition, the government presented expert testimony that it was actually impossible for patients to receive the dosages of medications as billed to Medicare. The expert also testified that these medications were normally provided by injection, not by infusion, and that—contrary to the practice at the two clinics—Neupogen and Procrit should not be mixed together or with saline solution.

Mr. Ferrer commended the investigative efforts of the FBI. Mr. Ferrer also thanked the U.S. Marshals Service for its assistance in returning this fugitive to the Southern District of Florida. The health care fraud case was prosecuted by Assistant U.S. Attorney Barbara Martinez.