Four Mississippians are among the more than 300 individuals detained in what federal and state prosecutors call the largest coordinated takedown of health-care fraud schemes in Justice Department history. This broad investigation, announced on Monday, underscores a growing threat of transnational criminal networks exploiting the United States’ health-care system.
Law enforcement activities led to the seizure of more than $245 million in cash, luxury vehicles, cryptocurrency, and other assets. Prosecutors cautioned that criminals had been detected in areas ranging from Russia and Eastern Europe to Pakistan and other countries, emphasizing the worldwide scope of these illegal operations.
“These criminals didn’t just steal someone else’s money. They stole from you,” stated Matthew Galeotti, who leads the Justice Department’s criminal division. “Every fraudulent claim, every fake billing, every kickback scheme represents money taken directly from the pockets of American taxpayers who fund these essential programs through their hard work and sacrifice.”
The suspected $14.6 billion in fraud discovered during this investigation is more than twice the previous high for the Justice Department’s annual health care fraud sweep. Since June 9, the Justice Department has charged or unsealed approximately 190 federal cases and over 90 state cases. Among those prosecuted are roughly 100 licensed medical professionals, including 25 doctors, with the government alleging actual losses of $2.9 billion.
One prime example of these groups’ increasingly advanced methods is a $10 billion urinary catheter scheme known as “Operation Gold Rush.” Authorities claim that the gang behind this vast fraud employed foreign straw owners to secretly buy dozens of medical supply companies. They then used stolen identities and personal health information to submit false Medicare claims. This investigation has charged nineteen individuals, leading to arrests in Estonia and at U.S. entry points like airports and the Mexican border. According to the Justice Department, the conspiracy entailed the theft of over one million Americans’ identities and personal information.
“It’s not done by small time operators,” commented Dr. Mehmet Oz, who leads the Centers for Medicare and Medicaid Services. “These are organized syndicates who are designing to hurt America.”
Ricky Wayne Quinn and John Anthony Null, both Corinth pharmacists, were arrested in Mississippi on charges of conspiracy to commit healthcare fraud. They allegedly cheated Medicare and Medicaid out of more than $700,000 by billing for the same prescription medicines many times. Their strategy entailed paying “runners” to return unopened prescription medications, which were subsequently refilled and billed.
Willie De Gibbs, a businessman from Toomsuba, Mississippi, and Cutler Bay, Florida, is facing allegations of conspiracy to conduct healthcare fraud, wire fraud, and money laundering. He is suspected of orchestrating a $19 million durable medical equipment (DME) fraud scam, including paying kickbacks for false doctors’ prescriptions to bill Medicare for orthotic braces that patients did not require. Gibbs also allegedly applied for fake Paycheck Protection Program (PPP) loans.
Auzie Phillip Smith, Jr., 66, of Madison, Mississippi, was charged with conspiracy to defraud the United States and offering/accepting bribes in connection with a $1.4 million laboratory fraud scam. Smith allegedly paid illegal payments to medical providers to induce referrals for unneeded molecular diagnostic tests, including toenail clippings, resulting in millions of bogus Medicare claims.