Former University of rochester employee pleads guilty to fraud

ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Debra Bulter pleaded guilty to conspiracy to commit mail fraud and to money laundering before U.S. District Judge Frank P. Geraci, Jr. Conspiracy carries a maximum sentence of 20 years in prison and a fine of $250,000. Money laundering carries a maximum sentence of 10 years in prison and a fine of $250,000. 

            Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that the defendant worked as the Program Administrator for the Department of Anesthesiology at the University of Rochester in Rochester. The Department of Anesthesiology provides anesthesia services to patients undergoing surgery or other procedures at Strong Memorial Hospital, Highland Hospital and other medical facilities in Rochester. A physician, known as the Chair, oversees the Anesthesiology Department's management and operations. The Program Administrator oversees administrative duties and reports to the Chair.

                        From 2001 through 2012, an anesthesia medical group, the “Anesthesia Medical Group,” contracted with the Department of Anesthesiology to provide anesthesiologists at medical facilities served by the Department of Anesthesiology. Between 2003 to 2008, two doctors (the “two Group doctors”) from the Anesthesia Medical Group individually contracted with the Department of Anesthesiology purportedly to provide additional administrative services to the Department of Anesthesiology.

                       From 2007 through 2012, the defendant participated in several schemes to defraud the Department of Anesthesiology and the Anesthesiology Medical Group.  One scheme involved deceiving the Department of Anesthesiology from 2007 to 2009 into making fraudulent payments to the two Group doctors and the Anesthesia Medical Group. The Department of Anesthesiology was provided fraudulent documents, including fraudulent requisition forms and invoices, which made it appear that the two Group doctors and the Anesthesia Medical Group had provided adequate services to the Department of Anesthesiology for such payments.  As a result of the fraudulent documents, the Department of Anesthesiology was deceived into paying the two Group doctors $930,000 and the Anesthesia Medical Group $530,000 to which they were not entitled. To compensate the defendant for her participation in the scheme, the Anesthesia Medical Group was deceived into paying the fraudulent money it received from the Department of Anesthesiology to a business started by the defendant, DJA Solutions, Inc.  

                    From January 2010 to September 2012, the Department of Anesthesiology and the Anesthesia Medical Group were deceived into causing a large portion of the compensation earned by the Anesthesia Medical Group from the Department of Anesthesiology to be diverted to the two Group doctors.  As a part of the scheme, the two Group doctors each executed fraudulent contracts with the Department of Anesthesiology for the fiscal years 2010 through 2013 which stated that they intended to provide additional administrative services to the Department of Anesthesiology worth more than $3,000,000.  These contracts were improperly signed by the defendant on behalf of the Department of Anesthesiology and concealed from the Chair of the Department of Anesthesiology and the other anesthesiologists at the Anesthesia Medical Group. The two Group doctors also caused invoices in their own names to be submitted to the Department of Anesthesiology which falsely represented that they had provided the services listed on such invoices. The scheme caused the Department of Anesthesiology to divert compensation actually earned by the Anesthesia Medical Group to the two Group doctors in the total amount of $1,909,156. To compensate the defendant for her role in this scheme, the Anesthesia Medical Group was deceived into to paying the defendant’s business, DJA Solutions, LLC, more than it was entitled. For the years 2010 through 2012, DJA Solutions, LLC received $1,169,606 from the Anesthesia Medical Group.

                    Another of the defendant's schemes involved causing the Department of Anesthesiology to make a fraudulent and unauthorized loan to a doctor working for the Department of Anesthesiology. The defendant disguised various payments to the doctor as extra compensation earned by the doctor.  The defendant did this by preparing fraudulent payroll documents, which were submitted to the Chair of the Department of Anesthesiology for authorization to pay the extra compensation to the doctor. The Chair signed such forms believing that the doctor was entitled to such extra compensation and was unaware that such payments were actually an improper loan to the doctor. The total amount of the fraudulent payments to the doctor was $510,726.

                    From October 2012 to May 2012, the defendant also caused the Department of Anesthesiology to pay a former employee of the Department of Anesthesiology $7,168 by disguising the payments as compensation earned by the former employee, when in fact, the former employee was no longer working for the Department of Anesthesiology.

                   Finally, from March 2009 to June 2012, the defendant submitted expense reimbursement forms totaling $13,097.67 to the Department of Anesthesiology for expenses which she either had already been reimbursed for or were not actual business expenses.

                  "In a scheme such as this, American taxpayers are defrauded twice," said U.S. Attorney Hochul. "They are defrauded a first time when medicare and medicaid funding is misspent and a second time when private insurance companies are impacted which could ultimately lead to higher premiums. This case serves as an example of the need for checks and balances in any organization. All employees, even those considered to be trusted individuals, need to have their work reviewed by another person."

       The plea is the culmination of an joint investigation on the part of the United States Postal Inspection Service, under the direction of Kevin Niland, Inspector in Charge, Boston Division, United States Postal Inspection Service, and the Internal Revenue Service, under the direction of Toni M. Weirauch, Special Agent-In-Charge, New York Field Office.

       The defendant is scheduled to be sentenced on November 21, 2013 at 9:30 a.m.