Oct. 21, 2011

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HOUSTON – Umawa Oke Imo, 57, a citizen of the Federal Republic of Nigeria and the owner of City Nursing Services of Texas Inc., was sentenced to 327 months in federal prison today for his role in a massive health care fraud conspiracy, United States Attorney Kenneth Magidson announced today. The conspiracy resulted in the billing of the federal Medicare and Texas Medicaid programs for $45,039,23.00 over a 2 ½-year-period.

Following an 18-day-trial, Imo - the sole owner of City Nursing - was found guilty of one count of conspiracy to commit health care fraud, 39 counts of health care fraud, three counts of mail fraud and five counts of money laundering on May 27, 2011. U.S. District Judge Melinda Harmon, who presided over the trial and pronounced the sentence, also ordered Imo to pay $30,216,592.15 in restitution to the Medicare and Medicaid programs as well as a $4,800 special assessment fee. City Nursing employee Joann Michelle White, 47, of Houston, who played a minor role in the health care fraud conspiracy, pleaded guilty to conspiracy in February 2010 and testified for the United States during Imo’s trial.

During trial, the United States presented the testimony of numerous Medicare and Medicaid beneficiaries about how they were paid cash for going to City Nursing and signing undated blank treatment forms. One beneficiary testified that when she asked for physical therapy she was told the clinic did not provide that type of services and to go to her PCP for a referral to another clinic. Another beneficiary described the clinic as looking like an unemployment office with people just hanging out, and referred to a day when he saw an employee direct a patient to make a pot of coffee. Despite billing more than $45 million for physical therapy services, Imo never hired a single physical therapist to work at City Nursing and “treatments” were predominantly limited to short massages and hot packs.

Former employees of City Nursing who testified for the United States, described how they handed out cash given to them by Imo and co-defendant Kenneth Anokam to beneficiaries and to “recruiters” or “marketers” who bought beneficiaries to the clinic. Beneficiaries were paid once a month when they came to see the doctor; however, those beneficiaries who took Medicare Explanation of Benefit statements into the office to complain about the fraudulent billing were given extra payments, sometimes $200 - $300 to “settle” matters. The employees also testified about how City Nursing billed Medicare for treatment that was not provided, including treatment for numerous individuals who were deceased. According to the employees, Imo and Anokam enlisted their help to create false and fraudulent patient file documents to reflect physical services that had not been provided.

In arriving at Imo’s sentence today, Judge Harmon considered that Imo had abused the trust of the Medicare and Medicaid programs, paid marketers and recruiters to lure beneficiaries to City Nursing, was the owner, organizer and leader of the conspiracy, and that he obstructed justice by failing to provide information to the court regarding his disposition of the $30 million paid by Medicare and Medicaid.

White was sentenced to 46 months on Oct. 14, 2011. The court considered White’s minor role in the conspiracy, noting that White was not the owner of the clinic, not a person in charge, and that she did not personally profit substantially from her criminal role in the conspiracy. Judge Harmon also considered White’s role in helping the United States prosecute White’s co-defendants.

Co-defendant Dr. Christina Clardy, under whose Medicare and Medicaid provider numbers City Nursing billed approximately $29 million worth of services she neither provided nor supervised, is scheduled for sentencing later this month. She and Anokam face up to 10 years in prison and a $250,000 fine for their health care fraud convictions. Clardy also faces up to 20 years in prison and a $250,000 fine for mail fraud, while Anokam faces up 10 years in prison and a $500,000 fine for his structuring convictions.

The investigation into City Nursing which resulted in an almost three-week-trial was the result of the joint efforts by agents of the FBI, Internal Revenue Service-Criminal Investigations, the Department of Health and Human Services-Office of Inspector General and the Texas Attorney General's Office-Medicare Fraud Control Unit. Assistant United States Attorneys Julie Redlinger and Mark Donnelly prosecuted the case. Assistant United States Attorney Kristine Rollinson assisted with forfeiture and restitution.