Whistleblower Blog

Medicare Fraud Convictions for Florida Home Health Care Operator for False Claims

Durable Medical Equipment Company Received Kickbacks from Pharmacy Owners in Health Care Fraud Case

In a Medicare fraud case of interest to whistleblowers and whistleblower attorneys, a Miami a federal jury convicted a home health care operator of conspiracy to defraud and submit false claims and receive kickbacks, conspiracy to commit health care fraud, and three counts of receiving kickbacks. Gisela Valladares, owner of PRN Home Health Care, Inc., faces up to 30 years in prison.

According to the Justice Department,
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Pharmaceutical Manufacturers Pursued for Medicaid Fraud by Texas Attorney General’s Office

Whistleblower Reveals Alleged Drug Price Schemes to Defraud Medicaid

When drug companies hide the true prices charged for prescription drugs, the pharma companies can violate laws protecting state Medicaid programs from being defrauded by “overpaying” for drugs. The experienced Medicaid fraud prosecutors of the Texas Attorney General’s Office have announced such allegations against three pharmaceutical manufacturers for tens of millions of dollars in Medicaid fraud in Texas.

For pharmaceutical products to be eligible for Medicaid reimbursement, the law generally requires that manufacturers accurately report
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Home Health Care Operator Receives Prison Time for Medicare Fraud

False Claims Act Case Continues Over Health Care Fraud Allegations

As other whistleblower attorneys who were former federal prosecutors know, Medicare fraud may sometimes lead not only to a qui tam whistleblower lawsuit, but also to prison time for the guilty party. A former home health care company owner now faces almost three years in prison after being convicted of defrauding Medicare of more than $1 million.

U. S. District Judge Nancy Edmunds in Detroit sentenced Amjad Khan, a certified public accountant
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Nursing Home Abuse and Fraud Exposed by Nurses in Qui Tam Whistleblower Case

Medicare Fraud and Medicaid Fraud Alleged by Nurses at Nursing Homes

Two nurses disturbed by nursing home abuse and neglect of nursing home residents–who apparently were subjected to gross nursing home malpractice–are the “whistleblowers” in a nursing home False Claims Act qui tam lawsuit in Missouri, which the U.S. Attorney’s Office in St. Louis has recently announced it has joined. The whistleblower suit alleges that the nursing home operator defrauded Medicare and Medicaid by providing care that was essentially “worthless” to the nursing home
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OFF LABEL MARKETING: BIG PHARMA’S PRESCRIPTION FOR PROFITS

The Food, Drug and Cosmetic Act prohibits pharmaceutical companies from marketing or promoting a drug for uses that the FDA has not approved. This practice is known in the industry as “off label marketing”. Increasingly, pharmaceutical companies have purposely engaged in off label marketing in order to increase profits at the price of public safety. Practitioners in this area see this every day. Whether the public and even the medical profession is aware of the extent of this practice is unknown. Nonetheless, it appears that the False Claims Act remains one of the best tools available to address this deplorable practice.

As an example of the problem, we noted in an article published in the Corporate Crime Reporter on May 8, 2007, that Medicis Pharmaceutical Corporation of Scottsdale, Arizona had agreed to pay $9.8 million to settle allegations filed under the False Claims Act against the company. Medicis promoted the use of a topical skin preparation called Loprox for use on children under the age of 10. The Justice Department and the whistleblowers involved, former Medicis employees, alleged that Medicis sales personnel had purposely targeted pediatricians urging these doctors to use Loprox as a treatment for diaper rash. This product had never been medically approved by the FDA for the treatment of diaper dermatitis or other skin disorders in children under 10. Nonetheless, Medicis sales personnel were aggressively marketing the product for these uses. While the story in the Corporate Crime Reporter did not detail how much profit had been generated from this off label marketing campaign, there was some accountability for this improper use of the product via the fine imposed. Unfortunately, and quite literally, we see these stories every day which is indicative of the fact that Big Pharma is pursuing profits over public safety.
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Retaliation Against Whistleblowers and Witnesses in Federal Proceedings

While there are many specific retaliation provisions unique to claims filed under the False Claims Act, with the Equal Opportunity Commission and/or arising out of Sarbanes-Oxley provisions, all of which protect informant employees from being retaliated against by their employer, a little known fact is that there is a general statute (42 U.S.C. § 1985) which makes it unlawful for two or more persons to conspire to “deter” a witness from testifying in Federal Court. This statute also makes it unlawful to “retaliate” against a
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Tax Whistleblowers Encouraged to Come Forward

Even though the Internal Revenue Service has had a Rewards Program for many years, until recently, there was very little encouragement for tax whistleblowers or informants to come forward concerning their knowledge of the under-reporting of taxes. While it is well known that income tax evasion costs taxpayers approximately $300 billion a year, the Internal Revenue Service in the past has failed to aggressively address this problem. While enforcement actions against criminals are designed to help deter tax fraud, the $300 billion annual figure is
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Accounting Firm Partners Indicted in Tax Fraud Case Over Tax Shelters Promoted by Ernst & Young

IRS whistleblowers and whistleblower attorneys take note: accounting firms participating in selling tax shelters were jolted by today’s announcement of the indictment of four Ernst & Young partners for tax fraud conspiracy and other federal criminal charges relating to tax shelters.

The four accountants were alleged to have marketed tax shelter transactions based on fraudulent factual scenarios, through which wealthy taxpayers could eliminate or reduce the taxes paid to the IRS, according to the government’s announcement. All four persons charged had worked in E&Y’s group
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New Whistleblower Law on Medicaid Fraud Signed Today by Governor of Georgia

I was excited to be invited to participate in today’s signing of the new Georgia “State False Medicaid Claims Act,” the newest state qui tam whistleblower law. The bill’s sponsor, Rep. Edward Lindsey, asked this whistleblower lawyer blog author to join him and representatives of the Georgia Department of Community Health in the Governor’s Office for the signing ceremony.

Having worked with legislators on this bill, I was very happy to celebrate the law’s passage today:Participating in the signing ceremony with Governor Sonny
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Addendum: IRS Whistleblower Office Is Off to a Strong Start . . .

I posted earlier today on this whistle blower lawyer blog about the comments of the Director of the new IRS Whistleblower Office, Stephen Whitlock, on how the IRS Whistleblower program is off to a good start, with credible claims and supporting evidence having been submitted by whistleblowers and their attorneys.

Since then, my partner commented that he believes one of our larger cases was referred to in the IRS Director’s comments about “knowledgeable insiders.” We also neglected to mention our IRS Whistleblower
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IRS Tax Whistleblowers & False Claims Act Qui Tam Cases–2007 Year in Review by Whistleblower Lawyer Blog

2007 has been a most significant year for whistleblowers. The whistleblower lawyer blog attorneys look back on some of the milestones:

1. As soon as Congress authorized the first meaningful IRS Whistleblower Rewards Program to pay tax whistleblowers 15-30% of IRS recoveries from those who violate the tax laws by statue effective on December 20, 2006, beginning in January our whistleblower lawyers submitted some of the first IRS Whistleblower claims in the nation under the new law. Our IRS Whistleblower cases have continued
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IRS Whistleblower Instructions for Filing Tax Whistleblower Claims Issued by IRS–and Are Reprinted Here on Whistleblower Lawyer Blog

The IRS a few hours ago issued the long-discussed “interim” guidance on pursuing Tax Whistleblower claims under the new IRS Whistleblower Program. This IRS Notice 2008-4 on filing claims under the IRS Whistleblower Program is effective January 14, 2008, and appears at https://www.irs.gov/pub/irs-drop/n-08-04.pdf.

Our whistleblower attorneys who work with the IRS in representing Tax Whistleblower clients will be continue their discussions of how the new IRS Whistleblower program is operating. The IRS Notice is reprinted below for convenience of whistleblower lawyer blog readers:
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Tax Whistleblowers: IRS Whistleblower Office Issues Long-Awaited Guidance for Tax Whistleblower Claims

Our whistleblower lawyer blog has followed closely the evolution of the new IRS Whistleblower Program, which celebrates its one-year anniversary on December 20, 2007/ Late today, on the eve of that anniversary, the new IRS Whistleblower Office issued long-awaited interim “guidance” for filing Tax Whistleblower claims–which should help tax whistleblowers and their attorneys.

Until now, whistleblower lawyers and their clients had to learn the procedures from reports of various public statements and discussions with IRS officials. I had the pleasure of getting to know how the IRS Whistleblower Office’s Director Stephen Whitlock intends to approach these claims, through appearing on a panel discussion with him in September in Washington to explain how the new IRS Whistleblower Program operates.

This interim guidance appears in IRS Notice 2008-4, which will be reprinted on this whistleblower lawyer blog in the next post. The IRS is soliciting comments, and much discussion undoubtedly will follow, both on our whistleblower lawyer blog and elsewhere.

It is an exciting day to see the new Guidance from the IRS on this important new IRS Whistleblower Program! We look forward to discussing it in detail on this blog, but simply wanted to get the word out tonight about this IRS announcement received from the IRS shortly before 6:00 p.m. tonight.
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False Claims Act Litigation Attorneys Gather in Atlanta to Explore Whistleblower Issues

At a conference on False Claims Act Litigation on November 30, attorneys representing the government, relators or whistleblowers, and defendants gathered to discuss whistleblower law issues. The conference was organized by the law firm of Balch & Bingham LLP.

This whistleblower lawyer blog writer had the pleasure of appearing on a panel with the Chief of the Civil Division of the U.S. Attorney’s Office in Atlanta, Amy Berne, and with Balch & Bingham’s John Markus.

Amy Berne opened with an overview of
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Tax Fraud & Tax Evasion Among Medicaid Providers: New IRS Whistleblower Program Fills Gap in False Claims Act for Whistleblowers and Their Attorneys

Two important topics of this whistleblower lawyer blog are addressed in a recent Government Accounting Office (GAO) Report on tax cheating by Medicaid providers. The Report shows the wisdom of the new IRS Whistleblower Program, which fills a “gap” in the coverage of the major whistleblower statute, the False Claims Act.

GAO reports that thousands of Medicaid providers collect large amounts of federal dollars each year, while cheating the government by failing to pay taxes owed–usually payroll taxes and personal income taxes.
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False Claims Act “Qui Tam” Whistleblower Cases Recover More Than $1 Billion In Latest Year, Justice Department Announces

Once again displaying the effectiveness of the False Claims Act in combating government fraud, the Justice Department has announced that it recovered $2 billion in fraud cases in the latest fiscal year that ended September 30, 2007. Qui tam whistleblower cases under the False Claims Act accounted for at least $1.45 billion of those recoveries, with the whistleblowers (or “relators’) sharing in those recoveries.

In all but one year since 2000, False Claims Act cases have generated at least $1 billion in
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IRS Whistleblower Regulations & “Guidance” for Whistleblower Attorneys from the IRS

Anticipating the new IRS Whistleblower Program regulations that are due by the December 20, 2007 first anniversary of the new IRS Whistleblower Program, the IRS Office of Chief Counsel has just issued a Notice on “Coordination of Section 7623 Whistleblower Claims in the Tax Court.”

As discussed extensively on this whistleblower lawyer blog, one of the major features of the new IRS Whistleblower Program is that whistleblowers who meet the program’s criteria now have an enforceable right to share in money
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IRS Whistleblower Program: Hedge Funds and Private Equity Firms Under Increasing IRS Scrutiny for Tax Abuses

Continuing this whistleblower lawyer blog’s discussions of the IRS’s strong interest in hedge funds and private equity firms, there have been several recent public statements and reports about IRS efforts to identify and stop tax fraud and tax noncompliance in these segments of the financial services industry.

Today, suspected tax abuses by hedge funds and private equity managers were the subject of a Tax Notes report, which cites a November 1, 2007 statement by the IRS. That same day, Bloomberg reported that
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TRICARE Medical Fraud Report–Whistleblower Attorneys Take Note that Health Care Fraud Continues to Plague Government

Fraud affecting health care is a frequent topic of our whistleblower lawyer blog. A new report on TRICARE, the U.S. Military’s health care system, shows that medical fraud continues, as honest whistleblowers and their lawyers continue the fight against government fraud.

More than 200 “qui tam” whistleblower cases were mentioned in the annual report of the Program Integrity Office of TRICARE, and more than 200 whistleblower cases have been brought each year since 2002.

The Report outlines numerous types of (more…)

False Claims Act Whistleblower Case to Be Decided By Supreme Court

This week, the United States Supreme Court agreed to hear a False Claims Act whistleblower case filed against the General Motors Corporation and its former division, Allison Engine Company. The alleged fraud concerns subcontracts for building parts for the U. S. Navy’s guided missile destroyers. Each of the 50 destroyers in question costs the taxpayers over $1 billion.

At issue in this case is an argument being made by the defendants that the whistleblower and the government cannot attack the alleged fraud scheme under
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