Whistleblower News: $6M Health Care Fraud, Vermont Ushers in New False Claims Act & Ocwen Whistleblower Suit
WHISTLEBLOWER NEWS QUOTE OF THE DAY:
"You have to credit the SEC for trying to understand what’s actually happening in the market. There’s been a lot of criticism over the years that there’s a lack of sophistication about markets and industry practice."
— Pat Smith, a former federal prosecutor and partner at Smith Villazor in New York
DAILY WHISTLEBLOWER HEADLINES:
Ambulance Company Owner and Brother Arrested in $6 Million Health Care Fraud Conspiracy
A 20-count federal indictment has been unsealed following the arrest of the owner of KMD Healthcare Services Inc., and his brother on charges they engaged in a conspiracy involving fraudulent Medicare and Medicaid billing for ambulance services, announced U.S. Attorney Kenneth Magidson.
Authorities arrested Melvin Davies, 28, and his brother Kevin Davies, 27, both of Houston today. They are expected to make their initial appearances before U.S. Magistrate Judge Frances H. Stacy tomorrow at 10:00 am.
The indictment alleges the defendants billed Medicare and Medicaid for ambulance services that were not medically necessary and not provided, as well as ambulance transport miles that were not provided. Melvin and Kevin Davies allegedly operated the ambulance business from their gated community townhouse and billed for ambulance services provided by vans and not ambulances. According to the indictment, Medicare and Medicaid were billed for services that were not documented on ambulance transport run sheets. The Davies brothers are also charged with spending more than $10,000 of criminally derived property. read more »
At Swinging Wall Street Parties, the Feds Are Now on the Prowl
As dealmakers crowded around the sleek circular bar at the Fontainebleau hotel in Miami last September, folks from the Securities and Exchange Commission were mingling, looking for their next big case.
Awkward, yes -- but not uncommon these days. Like a skunk at a garden party, the SEC has been moving in on the fun-loving Wall Street conference circuit in hopes of getting a better handle on who’s up to no good in the world of finance. Officials scour attendee lists to spot the biggest players in advance and, properly wearing name tags, schmooze over drinks. Of course, they don’t accept any -- that’s a no-no under SEC policy.
The SEC isn’t the only regulator trawling conferences for tips of suspicious conduct. The Commodity Futures Trading Commission was especially transparent about its intentions when it set up a booth in the middle of an industry gathering in March. Attendees at the opulent Boca Raton Resort & Club in Florida were greeted by smiling agency officials handing out metal whistles emblazoned with “CFTC” and mouse pads advertising their toll-free number.
The efforts show how regulators are trying to step up their game after missing Bernard Madoff’s Ponzi scheme and facing criticisms that they didn’t spot Wall Street abuses that led to the 2008 financial crisis.
Bond Conferences
“You have to credit the SEC for trying to understand what’s actually happening in the market,” said Pat Smith, a former federal prosecutor and partner at Smith Villazor in New York. “There’s been a lot of criticism over the years that there’s a lack of sophistication about markets and industry practice.”
The SEC has focused on bond conferences including ABS East and ABS Vegas, said people with knowledge of the matter who asked not to be named because the regulator’s efforts aren’t public. Held at luxury hotels in Miami as well as Las Vegas, the four-day conferences bring together investors and originators of debt backed by everything from car loans to jewelry. read more »
Vermont FCA now retroactive thanks to non-action by state legislature
The Vermont False Claims Act became effective on May 18, 2015, and included a provision stating that the statute would be considered non-retroactive until March 15, 2016.
However, beginning on the latter date, the Vermont FCA would be deemed to have retroactive application unless the legislature had enacted an amendment to the contrary.
Because no such legislative action was taken, the Vermont False Claims Act is now deemed retroactive, under 32 V.S.A. § 639(b), subject to the applicable limitations provisions under Vermont law.
Judge denies Ocwen's bid to end whistleblower lawsuit
Mortgage servicer Ocwen Loan Servicing will have to face trial on a whistleblower lawsuit accusing it of filing false claims for hundreds of millions of dollars of government payments, a federal judge in Texas has ruled.
In a decision on Tuesday, U.S. District Judge Amos Mazzant rejected Ocwen's motion to end the lawsuit, ruling that alleged false statements made by Ocwen could constitute a violation of the U.S. False Claims Act (FCA). read more »
