28 Charged in $9.5 Million Fraudulent Billing Health Care Fraud Scheme to Siphon and Steal Money from Workers' Compensation Program

DALLAS — Twenty-eight defendants, from the Dallas-Fort Worth metroplex, have been charged with various crimes related to their roles in a massive health care fraud scheme that involved bribes, unnecessary medical treatment, fraudulent billing, and the falsification of medical documents to fraudulently bill the federal government, through the Department of Labor’s (DOL) Office of Worker Compensation Programs (OWCP), more than $9.5 million.   U.S. Attorney John Parker of the Northern District of Texas made the announcement today.

The criminal felony Information filed today charges 21 claimants, four doctors or medical providers, a senior claims examiner at DOL, a claims representative, and a medical provider’s employee in the scheme.  Signed plea papers were filed today for each of the 28 defendants indicating their intent to plead guilty.  Arraignment dates have not yet been set for those pleas.

“These charges are the result of a two-year investigation led by special agents with the U.S. Postal Service Office of Inspector General and the Department of Labor Office of Inspector General,” said U.S. Attorney Parker.  “Their dogged determination and skilled investigative techniques were crucial in exposing and dissecting this sprawling corruption scheme.  This office will continue to vigorously pursue those who fraudulently obtain benefits at the expense of those who have a legitimate need.”

According to the filed Information and plea papers, the 28 below-listed defendants, and others yet uncharged, engaged in a complex and sprawling health care fraud scheme designed to improperly siphon and steal money from DOL’s OWCP:

Larry Washington, 63, of Desoto

Dr. Robert Mandell, 72, of Plano

Ifeyani “Tim” Egbuchunam, 60, of Plano

Henrietta Price, 51, of Cedar Hill

David Banda, 33, of Duncanville

Willie Atkins, 71, of Lancaster

Perry Rowell, 55, of Garland

McArthur Baker, 68, of Dallas

Doris Berry, 52, of Dallas

Byron Bonds, 43, of Mesquite

Michael Bowen, 58, of Dallas

Patricia Brown, 62, of Benbrook

Calandra Cumby, 44, of Dallas

Tonya Evans, 51, of Dallas

Darrell Glasco, 50, of Dallas

Regina Howard, 61, of Desoto

Willard Johnson, 64, of Desoto

Palante McClain, 47, of Cedar Hill

Rhonda McCoy, 47, of Arlington

Vontril McClemore, 61, of Carrollton

Regina Mitchell, 58, of Dallas

Wanda Proctor, 62, of Duncanville

Rhonda Sanders, 50, of Dallas

Clarinda Scott, 56, of Arlington

Patricia Skinner, 59, of Desoto

Janyce Ingram, 53, of Desoto

Brenda Hall, 65, of Dallas

Cassandra Sims, 60, of Dallas

In total, the defendants were able to collectively fraudulently bill the federal government through the OWCP for more than $9.5 million and receive more than $8.7 million in government payments based on their fraudulent billing.  The DOL made approximately $11.4 million in payments to these claimants for their compensation and medical services.  As a result of the guilty pleas associated with the Information, the government anticipates that it will prevent the payment of an estimated $11 million in future payments to the claimant defendants.

The scheme began with former or current government employees – U.S. postal employees or Veterans Affairs (VA) employees – who claimed that they had been injured during the course of their work duties.   Each of these claimants claimed they had suffered an on-the-job injury, ranging from strains to trigeminal neuralgia, which prevented them from returning from work.

Under OWCP, these “claimants” could receive workers’ compensation payments (typically between 66% and 75% of pre-disability wages, tax free) and paid medical treatment, if a qualified doctor deemed the medical services necessary to treat the injury and if the injury prevented the claimant from working. 

A DOL claims examiner would review the claim and its documentation, and either approve or reject the claim.  In certain circumstances, if an on-the-job injury caused permanent damage, a claimant could have received a “scheduled award” – that is, a lump sum payment meant to compensate that individual for their injury.  These awards often amounted to several hundred thousand dollars.  Claimants often sought the help of professionals, typically former DOL claims examiners in filing their claims and in getting their claims approved.  These “claims representatives” either charged claimants a percentage of any paid claim or a flat rate fee.  When doctors or other medical providers treated the claimants, they could bill OWCP for their work if they submitted the proper documentation and certification.

Larry Washington was a licensed professional counselor and ran businesses known as AAA Mental Health, LLC, Mind Spa, Inc., Solutions Health and Rehabilitation, and Convergence Emergence Diversion.  Through these businesses, Washington purportedly provided patients with counseling, pain management, chiropractic services, physical therapy and massage services.  He sought out and recruited his patients who were former postal and VA employees who had suffered on-the-job injuries that prevented them from returning to work.  Washington knew that even though these individuals had once suffered a work-related injury, their injuries were not severe enough to warrant continued OWCP payments.

Washington also billed for services that he allegedly provided to patients in Dallas when he was traveling and not even present in Dallas.  He also billed for services he allegedly provided to patients while he was in the hospital during that time for his own medical treatment.  Washington also asked claimants to falsify medical documentation, indicating they had received services on days when, in fact, they had not.  Upon completion and submission of the forms, the claimants received $100 for each of the forms they completed.                                        

Dr. Robert Mandell was a licensed psychologist with more than 35 years of experience in treating patients.  He is also the President, CEO, Clinical Director, and part owner of AAA Mental Health, LLC, which maintained offices in Richardson, Texas.  He prepared fraudulent psychological reports to be submitted to OWCP.  These psychological reports were crucial to the scheme because for claimants to receive the proper upgrades and certifications, they needed a diagnosis and certification related to their mental state as it related to their physical injury.  In many, the alleged mental aspect of the injury is what caused a lengthy delay to return to work.

Henrietta Price and Willie J. Atkins were licensed professional counselors and provided counseling services at Mind Spa, Inc.  Price also treated patients under her own company, Lifeline Counseling.  Atkins ran his own practice, Atkins Counseling Center.

Perry Rowell was a Senior Claims Examiner at the OWCP.  With more than 22 years of federal government service, Rowell was assigned to the Dallas District Office.  For years, he accepted monthly cash bribes, totaling $24,000, from Ifeanyi “Tim” Egbuchunam, a former DOL claims examiner who represented claimants before the OWCP.   In return, Rowell expedited payments and decisions and immediately responded to Egbuchunam’s telephone calls about technical case status questions.

Defendant David Banda worked at Mind Spa, Inc. in February 2009 and served as an office administrator and biller for Washington’s businesses; he reported directly to Washington.

Washington, Mandell, Price, Banda and Atkins are each charged with one count of conspiracy to commit health care fraud.  That offense, upon conviction, carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.

Egbuchunam is charged with one count of bribery of a public official.  That offense, upon conviction, carries a maximum statutory penalty of 15 years in federal prison and a $250,000 fine.

Rowell is charged with one count of bribery received by a public official.  That offense, upon conviction, carries a maximum statutory penalty of 15 years in federal prison and a $250,000 fine.

Baker, Berry, Bonds, Bowen, Brown, Cumby, Evans, Glasco, Howard, Johnson, McClain, McCoy, McClemore, Mitchell, Proctor, Sanders, Scott, Skinner, Ingram, Hall and Sims are also each charged with making a false statement or fraud to obtain federal employees’ compensation.  That offense, upon conviction, carries a maximum statutory penalty of one year in federal prison and a $250,000 fine.

The investigation was led by the U.S. Postal Service Office of Inspector General, and the Department of Labor Office of Inspector General, with assistance from Internal Revenue Service Criminal Investigation, U.S. Treasury Office of Inspector General, Social Security Administration Office of Inspector General/Cooperative Disability Investigations Unit, and the U.S. Department of Veterans Affairs Office of Inspector General.

Assistant U.S. Attorney P.J. Meitl and Special Assistant U.S. Attorneys Jennifer Bray and Nicola Dana are in charge of the prosecution.

# # #