DEBRA W. YANG
United States Attorney
Central District of California
Thom Mrozek, Public Affairs Officer
(213) 894-6947
thom.mrozek@usdoj.gov
April 5, 2004 Return to the
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PRINCIPAL OF GREYBOR MEDICAL TRANSPORTATION GUILTY OF FEDERAL HEALTH CARE FRAUD, MONEY LAUNDERING CHARGES
An owner and operator of Greybor Medical Transportation, a Los Angeles-based ambulance company, was convicted today on federal health care fraud and money laundering charges for, among other things, billing Medicare for the transportation of bedridden patients who were in fact ambulatory.
Boris Shpirt, 50, of Beverly Hills, was convicted this afternoon by a federal jury in Los Angeles. The jury convicted Shpirt of conspiracy, 11 counts of health care fraud, six counts of money laundering, two counts of filing false tax returns and six counts of laundering money for the purpose of defrauding the Internal Revenue Service.
Shpirt’s wife, Jenny, 43, was also convicted this afternoon when the jury found her guilty of conspiracy, two counts of health care fraud, two counts of filing false tax returns and six counts of laundering money for the purpose of defrauding the IRS.
This case marks the first time that anyone has been convicted in this district of money laundering for the purpose of defrauding the IRS.
Greybor itself was convicted of conspiracy and nine counts of health care fraud. A fourth defendant, Daniel Gonzalez, a 29-year-old Pico Rivera man, who was a supervisor at Greybor, was found guilty of conspiracy and eight counts of health care fraud. (The jury was unable to reach a verdict on one count of health care fraud against Gonzalez.)
Boris Shpirt’s partner and co-owner of Greybor, 50- year-old Gregory Plotkin of Beverly Hill, previously pleaded guilty and testified at trial against his co-defendants. Plotkin pleaded guilty to conspiracy to commit health care fraud.
A sixth defendant in this case, Robert White, died prior to trial.
The evidence presented during a four-week trial showed that Greybor regularly submitted claims to Medicare that falsely stated a patient was “bed-confined,” when in fact the Medicare beneficiary was not. In some cases, the patient was transported while sitting in the front seat of the ambulance. These false statements to the government insurance program allowed Greybor to be reimbursed by Medicare when it was not entitled to receive payment. Medicare will pay for ambulance transportation only if no other option is available and only if the patient is bed-confined.
On many occasions, Greybor ambulances were used to transport four or five patients simultaneously, but Greybor later submitted claims to Medicare which indicated the Medicare beneficiaries were being transported individually.
Furthermore, Greybor falsely claimed that patients were being taken to dialysis treatment, which would be reimbursed by Medicare, when in fact they were being transported for other treatments that would not lead to reimbursement by Medicare.
The fraudulent bills submitted by Greybor to the Medicare program caused losses of more than $5 million.
Shpirt and Plotkin also ran two durable medical equipment companies - Pride Medical Industries and GABA Medical Industries. The indictment alleges that Boris Shpirt and White provided medical equipment to Spanish-speaking individuals who did not want or need the equipment. Medicare will pay for medical equipment only if the item is necessary and reasonable for the treatment of an illness or injury.
Employees of Pride and GABA would use counterfeit prescriptions to deliver inexpensive and unnecessary medical equipment to Medicare beneficiaries. The employees would convince the Spanish-speaking beneficiaries to sign English-language documents that turned out to be receipts for the unnecessary equipment, as well as more expensive equipment that was never delivered. Boris Shpirt submitted claims to Medicare for the unnecessary and non-existent medical equipment.
The Shpirts’ scheme to defraud the IRS led the couple to launder proceeds from Greybor through a company they set up. In addition to claiming that money from Greybor represented loan repayments instead of income, the Shpirts used income from their company to pay rent and to pay for the construction of their Beverly Hills home. In 1999 and 2000, the Shpirts underreported their income by more than $1.1 million.
The conspiracy charge carries a maximum penalty of five years in federal prison. The health care fraud charges carry a penalty of up to 10 years for each count. The money laundering charges each carry a maximum penalty of 10 years. And the charges related to the false tax returns carry maximum penalties of three years in prison.
This case is the product of an investigation conducted by the Department of Health and Human Services, Office of Inspector General; IRS-Criminal Investigation; and the California Bureau of Medi-Cal Fraud and Elder Abuse.
Release No. 04-045