North Texas Pair Ran a $7 Million COVID-19 Testing Scheme, U.S. Attorney Says

A pair of North Texas residents pleaded not guilty on Dec. 16 to charges they defrauded insurers of more than $7 million via fake COVID-19 tests. A statement released by the U.S. attorney for the Northern District of Texas, Leigha Simonton, claims that Terrance Barnard, 39, and Connie Jo Clampitt, 51, submitted false testing claims to Blue Cross Blue Shield of Texas, Cigna, United Healthcare, Aetna, Humana and Molina Healthcare.

The government alleges that Barnard and Clampitt spotted an opportunity amidst medical and financial chaos and seized it to enrich themselves with millions of dollars over the course of 13 months.

"Mr. Barnard allegedly used his position as a contract lab technician at various medical clinics to surreptitiously obtain patient names, addresses, dates of birth and insurance subscriber information," the statement reads. "He and Ms. Clampitt then allegedly represented to the patients' insurers that they had COVID-19 testing performed at sophisticated diagnostic laboratories, when no such testing was performed and no such labs existed."

Before the pair's arrest on Thursday, Dec. 15, Barnard and Clampitt were indicted on Dec. 5 on one count each of conspiracy to commit healthcare fraud, 10 counts each of healthcare fraud, seven counts each of aggravated identity theft and one count each of conspiracy to commit money laundering. A detention hearing on Wednesday will determine if they can be released on bond.

The indictment alleges that Barnard and Clampitt submitted the fraudulent claims between March 2021 and April 2022 through a number of fictitious labs purported to be test providers throughout Texas, including several in the Dallas/Fort Worth area.

"It was part of the scheme and artifice to defraud that Barnard and Clampitt created entities to make it appear that COVID-19 testing was performed by sophisticated diagnostic laboratories, when in truth and fact, the laboratories as explained, did not exist," the indictments states.

The money Barnard and Clampitt received for the false claims, it is alleged, was deposited into bank accounts set up for each of the nonexistent clinics. From there, the money made its way into the personal accounts of the defendants, who used it to "purchase real estate and luxury vehicles," according to the statement.

"With healthcare trials, there's a lot of data, a lot of information to get through unlike many criminal trials." – Attorney Brandon McCarthy

tweet this

Barnard's attorney, Brandon McCarthy, has had a chance to review some of the evidence and says this sort of trial tends to take a long time. "With healthcare trials, there's a lot of data, a lot of information to get through unlike many criminal trials," he says.

"The COVID-19 pandemic has presented the most challenging circumstances our healthcare providers and insurers have faced in generations," Simonton said in the statement. "Schemes to financially exploit the system when providers and insurers are facing these monumental challenges must be dismantled, and those responsible must be held to account."

COVID-19-related schemes in the United States have now totaled in the billions of dollars. Much of that has been through bogus unemployment benefits claims and the Paycheck Protection Program, although healthcare-related fraud has certainly made its mark. In May 2021 the Department of Justice formed the COVID-19 Fraud Enforcement Task Force, and in April 2022 DOJ said it had charged more than 4,000 defendants with more than $19 billion in fraud related to COVID-19 testing and healthcare.

The U.S. attorney says that over the course of its investigation of Barnard and Clampitt, law enforcement seized $1.5 million. If convicted, the pair will be required to forfeit any proceeds or property traceable to the crimes and will face up to 10 years in federal prison for each count of healthcare fraud, conspiracy to commit health care fraud and conspiracy to commit money laundering, and up to two years in federal prison for each count of aggravated identity theft.