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Pharmacy Owner Receives 15 Years in Prison for $100 Million Fraud Scheme

The government has continued to bring in hundreds of people who have sought to defraud its agencies through the use of elaborate schemes. This was proven to be the case last week when the Justice Department announced that the president and owner of a Florida pharmacy has been convicted of fraud and sentenced to 180 months in prison for his participation in a massive compounding scheme. The scheme impacted private insurance companies as well as Medicare and TRICARE and involved several other individuals who have previously been sentenced or are awaiting sentencing in the case. Moreover, the owner -Nicholas A. Borgesano Jr – has also been ordered to pay $54 million and to surrender various real properties for his part in the scheme. Borgesano plead guilty in November of 2017 to one count of conspiracy to commit health care fraud and one count of conspiracy to engage in monetary transactions involving criminally derived properties. Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division made the announcement along with several other agents from the FBI’s Tampa Field Office, the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG), and others.

As a part of his plea agreement, Borgesano admitted that he owned several pharmacies and shell companies that he and his co-conspirators used to execute a massive fraud scheme involving prescription compounded medications. Their scheme generated more than $100 million. Borgesano owned numerous pharmacies including A to Z Pharmacy, Medplus/New Life Pharmacy and Metropolitan Pharmacy, etc. Borgesano admitted to submitting false and fraudulent claims through these pharmacies to private insurance companies and to Medicare and TRICARE. He and his co-conspirators did so by manipulating billing codes to their advantage. Borgesano also admitted that he and his co-conspirators paid kickbacks and bribes in exchange for patient identifying information. Finally, Borgesano admitted to using wire and check transfer in order to distribute the proceeds of his scheme to his co-conspirators and his shell companies. Several of Borgesano’s co-conspirators have received sentences ranging from 12 to 66 months in prison.

In addition to the prison terms that Borg and his co-conspirators received, the men have also been made to surrender items such as cars, boats and real properties valued at more than $7.6 million. These items were purchased by the defendants with proceeds from the fraud scheme. This investigation was spearheaded by several government agencies in conjunction with the Medicare Fraud Strike Force. The Strike Force is part of a joint initiative between the DOJ and HHS to prevent and deter fraud committed against agencies such as Medicare, Medicaid and TRICARE. Qui tam Medicare cases have recovered more than $12.5 billion in falsely billed services. People who report fraud and abuse are protected by the qui tam or whistleblower provisions of the False Claims Act. A whistleblower law firm helps protect the interest of whistleblowers in these cases.