$172M medical fraud based in South Florida sends nine people to federal prison

April 01--Several South Florida residents have been sentenced to federal prison for their roles in a $172 million insurance fraud, authorities said Friday.

The criminal conspiracy regarding specialty prescription creams went on for more than two years and involved lying to and defrauding numerous health care insurance providers to get them to pay the trumped-up costs of the medical ingredients, prosecutors said. The creams were supposed to treat pain and other medical conditions.

Investigators said the defendants prepared and sold the prescription medications in bulk quantities but claimed they were specially prescribed and tailor-made creams for specific individual patient needs.

In some cases, private insurance companies paid as much as $31,000 for a single tube of cream, court records show.

The defendants concealed that they were paying illegal kickbacks to some doctors and medical professionals to issue prescriptions for the medications, authorities said.

The fraud, which involved companies based in Boca Raton, Texas and Nevada, targeted private insurance companies and Tricare, a health care program of the U.S. Department of Defense. Tricare provides coverage for active duty members of the military, veterans, retirees and their families.

A total of 16 defendants have pleaded guilty to related charges and have turned over more than $30 million worth of assets to the federal government. The full amount of restitution they owe will be decided in the next few months.

So far, Senior U.S. District Judge Daniel T. K. Hurley has imposed the following federal prison terms:

Clifford Carroll, 36, of Boca Raton, 15 years;

Todd Stephens, 52, of West Palm Beach, 10 years;

Joel McDermott, 41, of Boca Raton, six years;

Michael Kenna, 30, of Delray Beach, five years;

Todd Hanson, 47, of Zephyr Cove, Nev., eight years;

Christopher Mucha, 30, of Davie, 2 1/2 years;

Ian Flaster, 34, of Delray Beach, three years;

William Earl, 73, of Boca Raton, two years;

and Dr. Peter Williams, 56, of New Port Richey, five years.

Six more defendants are scheduled for sentencing in May, according to court records.

[email protected], 954-356-4533 or Twitter @SentinelPaula

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