Man accused of Medicare fraud can use business partner's life insurance to secure lawyer - Insurance News | InsuranceNewsNet

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February 17, 2017 Newswires
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Man accused of Medicare fraud can use business partner’s life insurance to secure lawyer

Frederick News-Post (MD)

Feb. 17--A Frederick doctor charged in a medical kickback scheme can collect part of his business partner's life insurance policy to pay for a lawyer, despite the government's request to freeze the asset.

Atif Babar Malik, of Germantown, was one of five medical professionals indicted on charges related to financial crimes linked to American Spine Center, a pain management practice in Frederick.

Prosecutors in U.S. District Court in Maryland said that American Spine Center's owners, Malik and Dr. Sandeep Sherlekar, fraudulently collected around $530,000 in Medicare reimbursements.

Prosecutors also alleged that the doctors referred patients for lab services and medical items in exchange for kickbacks that came to around $1.37 million.

Sherlekar, one of Malik's co-defendants, died by suicide on Sept. 30, 2016, soon after the indictment was made public. He had named Malik the beneficiary of a life insurance policy worth more than $5 million.

Federal prosecutors filed a motion on Jan. 20 to freeze the asset. The motion was approved by the court three days later.

Malik, however, asked the court to reconsider its decision. On Feb. 7, U.S. District Judge Marvin J. Garbis ordered the life insurance company, John Hancock, to pay out the policy to the court clerk to hold.

The clerk, in turn, will release $1.750 million to Malik, so that he can retain a new attorney -- Joshua D. Greenberg, a Washington lawyer who specializes in white-collar crime cases.

The cost could be up to $3 million because of the complexity of the case, according to a formal statement to the court by attorney Solomon L. Wisenberg.

Any other actions regarding the policy will be considered later, according to the court filing.

Greenberg argued that the government could not stop the insurance payment because none of the crimes with which his client had been charged was connected to the policy.

He added that the U.S. has already collected $178,000 from another defendant, Vic Wadhwa, who pleaded guilty and is awaiting sentencing, according to records. Because the government had already collected those funds, it would not be entitled to more than $355,500 from Malik, the attorney argued.

Greenberg cited court precedent that established that restraining funds needed for defendants to retain counsel violates their right to a fair trial under the Constitution.

Follow Kelsi Loos on Twitter: @KelsiLoos.

___

(c)2017 The Frederick News-Post (Frederick, Md.)

Visit The Frederick News-Post (Frederick, Md.) at www.fredericknewspost.com

Distributed by Tribune Content Agency, LLC.

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