https://www.cnbc.com/2023/06/28/doj-charges-78-people-with-2point5-billion-in-health-care-fraud.html Skip Navigation logo * watchlive logo Markets * Pre-Markets * U.S. Markets * Currencies * Cryptocurrency * Futures & Commodities * Bonds * Funds & ETFs Business * Economy * Finance * Health & Science * Media * Real Estate * Energy * Climate * Transportation * Industrials * Retail * Wealth * Life * Small Business Investing * Personal Finance * Fintech * Financial Advisors * Options Action * ETF Street * Buffett Archive * Earnings * Trader Talk Tech * Cybersecurity * Enterprise * Internet * Media * Mobile * Social Media * CNBC Disruptor 50 * Tech Guide Politics * White House * Policy * Defense * Congress * Equity and Opportunity CNBC TV * Live TV * Live Audio * Business Day Shows * Entertainment Shows * Full Episodes * Latest Video * Top Video * CEO Interviews * CNBC Documentaries * CNBC Podcasts * CNBC World * Digital Originals * Live TV Schedule Watchlist Investing Club * Trust Portfolio * Analysis * Trade Alerts * Meeting Videos * Homestretch * Jim's Columns * Education PRO * Pro News * Pro Live * Market Forecast * Subscribe * Sign In Menu * Make It * select + ALL SELECT + Credit Cards + Loans + Banking + Mortgages + Insurance + Credit Monitoring + Personal Finance + Small Business + Taxes + Help for Low Credit Scores + Investing + SELECT + All Credit Cards + Find the Credit Card for You + Best Credit Cards + Best Rewards Credit Cards + Best Travel Credit Cards + Best 0% APR Credit Cards + Best Balance Transfer Credit Cards + Best Cash Back Credit Cards + Best Credit Card Welcome Bonuses + Best Credit Cards to Build Credit + SELECT + All Loans + Find the Best Personal Loan for You + Best Personal Loans + Best Debt Consolidation Loans + Best Loans to Refinance Credit Card Debt + Best Loans with Fast Funding + Best Small Personal Loans + Best Large Personal Loans + Best Personal Loans to Apply Online + Best Student Loan Refinance + SELECT + All Banking + Find the Savings Account for You + Best High Yield Savings Accounts + Best Big Bank Savings Accounts + Best Big Bank Checking Accounts + Best No Fee Checking Accounts + No Overdraft Fee Checking Accounts + Best Checking Account Bonuses + Best Money Market Accounts + Best CDs + Best Credit Unions + SELECT + All Mortgages + Best Mortgages + Best Mortgages for Small Down Payment + Best Mortgages for No Down Payment + Best Mortgages with No Origination Fee + Best Mortgages for Average Credit Score + Adjustable Rate Mortgages + Affording a Mortgage + SELECT + All Insurance + Best Life Insurance + Best Homeowners Insurance + Best Renters Insurance + Best Car Insurance + Travel Insurance + SELECT + All Credit Monitoring + Best Credit Monitoring Services + Best Identity Theft Protection + How to Boost Your Credit Score + Credit Repair Services + SELECT + All Personal Finance + Best Budgeting Apps + Best Expense Tracker Apps + Best Money Transfer Apps + Best Resale Apps and Sites + Buy Now Pay Later (BNPL) Apps + Best Debt Relief + SELECT + All Small Business + Best Small Business Savings Accounts + Best Small Business Checking Accounts + Best Credit Cards for Small Business + Best Small Business Loans + Best Tax Software for Small Business + SELECT + All Taxes + Best Tax Software + Best Tax Software for Small Businesses + Tax Refunds + SELECT + All Help for Low Credit Scores + Best Credit Cards for Bad Credit + Best Personal Loans for Bad Credit + Best Debt Consolidation Loans for Bad Credit + Personal Loans if You Don't Have Credit + Best Credit Cards for Building Credit + Personal Loans for 580 Credit Score or Lower + Personal Loans for 670 Credit Score or Lower + Best Mortgages for Bad Credit + Best Hardship Loans + How to Boost Your Credit Score + SELECT + All Investing + Best IRA Accounts + Best Roth IRA Accounts + Best Investing Apps + Best Free Stock Trading Platforms + Best Robo-Advisors + Index Funds + Mutual Funds + ETFs + Bonds * USA * INTL * watchlive Search quotes, news & videos Watchlist SIGN IN Create free account logo Markets Business Investing Tech Politics CNBC TV Watchlist Investing Club PRO Menu Health and Science Justice Department charges 78 people with $2.5 billion in health-care fraud Published Wed, Jun 28 20231:27 PM EDTUpdated 2 Hours Ago thumbnail Spencer Kimball@spencekimball WATCH LIVE Key Points * The Department of Justice said it has charged 78 people with $2.5 billion in health-care fraud as part of a coordinated crackdown. * The DOJ said the defendants allegedly defrauded programs used to take care of elderly and disabled people, and in some cases used the ill-gotten money to buy exotic cars, jewelry and yachts. * Among those charged are 11 defendants accused of submitting $2 billion in fraudulent claims through telemedicine, as well as 10 defendants charged in connection with fraudulent prescription drug claims. U.S. Attorney General Merrick Garland speaking on June 22, 2023 in Washington, DC. Chip Somodevilla | Getty Images The Department of Justice announced Wednesday that it has recently charged 78 people with $2.5 billion in separate health-care fraud and opioid abuse schemes. The defendants allegedly defrauded programs used to take care of elderly and disabled people, and in some cases used the ill-gotten money to buy exotic cars, jewelry and yachts, the DOJ said. Among those charged are 11 defendants accused of submitting $2 billion in fraudulent claims through telemedicine, as well as 10 defendants charged in connection with fraudulent prescription drug claims. In all, prosecutors filed charges against people in 16 states in cases that were lodged or unsealed in the past two weeks as part of the coordinated crackdown. The defendants include "physicians and other licensed medical professionals who lined their own pockets, including doctors who allegedly put their patients at risk by illegally providing them with opioids they did not need," the DOJ said in a press release. Attorney General Merrick Garland in a statement said, "These enforcement actions, including against one of the largest health care fraud schemes ever prosecuted by the Justice Department, represent our intensified efforts to combat fraud and prosecute the individuals who profit from it." In the scheme cited by Garland, executives of supposed software and services companies submitted $1.9 billion in fraudulent claims to Medicare for items that were not eligible for reimbursement, according to the DOJ. The defendants in that case are Brett Blackman and Gregory Schreck of Johnson County, Kansas, and Gary Cox of Maricopa County, Arizona, who allegedly used mass telemarketing operations to sell the elderly and disabled expensive and unnecessary medical equipment and prescriptions, according to an indictment in U.S. District Court for the Southern District of Florida. CNBC Health & Science Read CNBC's latest health coverage: * Eli Lilly experimental obesity drug could beat rivals in total weight loss for patients * Novo Nordisk says high-dose experimental obesity pill leads to 15% weight loss * Biden to sign executive order expanding access to birth control The trio allegedly operated a software platform called DMERx that generated fake and fraudulent doctors' orders in exchange for illegal kickbacks and bribes. Cox was CEO of the company that originally operated the software behind the fraud scheme. He subsequently sold the platform to a company where Black was CEO and Schreck was vice president of business development. The defendants allegedly received payments for referring fraudulent doctors' orders and prescriptions to pharmacies, suppliers and telemarketers, according to the indictment. The orders and prescriptions claimed the doctors had actually examined or treated the patients when in reality the physicians were paid to sign the documents by supposed telemedicine companies, the indictment alleges. In many instances, the doctors had just a brief phone call with the patients or no interaction at all, according to the indictment. In an effort to conceal the scheme, the defendants allegedly removed references to telemedicine in the orders. In a separate case, the DOJ also indicted Steven Diamantstein, owner of Scripts Wholesale Inc., for a $150 million fraud scheme involving HIV medication. Diamantstein, who lives in Brooklyn, New York, allegedly purchased HIV drugs at a steep discount from people who illegally obtained the pills by paying patients cash and repackaging them for sale. Diamentstein then falsely claimed his company had obtained the drugs through legal channels, according to an indictment in U.S. District Court in New Jersey. The DOJ also charged 24 doctors and medical professionals in cases related to $150 million in false billings involving the illegal distribution of opioids and lab testing fraud. logo * Subscribe to CNBC PRO * Licensing & Reprints * CNBC Councils * Select Personal Finance * CNBC on Peacock * Join the CNBC Panel * Supply Chain Values * Select Shopping * Closed Captioning * Digital Products * News Releases * Internships * Corrections * About CNBC * Ad Choices * Site Map * Podcasts * Careers * Help * Contact * * * * * * * News Tips Got a confidential news tip? We want to hear from you. 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