Santa Ana-Based Street Gang Implicated in $25 Million Medicare Fraud Cases

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​A Long Beach man and a Santa Ana street gang have been implicated in an alleged Medicare fraud schemes that resulted in approximately $25 million in fraudulent bills to the Medicare program, various federal authorities announced this morning.

In all, 18 defendants, most of whom reside in the Los Angeles area, have been charged in five indictments for allegedly participating in the fraud schemes, announced Assistant Attorney General of the Criminal Division Lanny A. Breuer, Acting U.S. Attorney for the Central District of California George S. Cardona and Daniel R. Levinson, Inspector General of the Department of Health & Human Services (HHS).

Michael Martinez, 30, of Long Beach, and six other defendants were charged with conspiracy to commit health care fraud and for making false statements to the government.  Martinez, the alleged ring leader, is accused of recruiting relatives and individuals linked to the Santa Ana-based Brook Street Gang to act as straw owners for four fraudulent medical equipment companies.

If convicted, Martinez faces a maximum sentence of 75 years in federal prison.

 

Federal and state agents arrested five defendants this morning, and seven others were taken into custody last week, as the result of an investigation that targeted fraudulent durable medical equipment (DME) providers. Those arrested today were scheduled to make their initial appearances in U.S. District Court in Los Angeles this afternoon.

The DME company owners and marketers are accused of engaging in a variety of schemes involving the fraudulent ordering of power wheelchairs, orthotics (devices designed to assist with orthopedic problems) and hospital beds. 

Other defendants from all over California and Nevada face sentences ranging from 15 years to 180 years in federal prison if convicted of all counts against them. The agencies that made the arrests that led to the indictments are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT).

"Today's indictments and arrests are important achievements in our ongoing fight against Medicare fraud, but there is more that we can, and will, do," Breuer says in a statement released by the FBI. "Our Medicare Fraud Strike Force will continue to be vigilant in rooting out criminals who masquerade as health care providers in order to steal from American taxpayers.  Every dollar stolen from the Medicare program is one dollar too many."

"The Strike Force has been an effective tool to address a long-standing problem in my district," Cardona adds in the same statement. "The nearly two dozen people charged in recent weeks are linked to approximately $25 million in fraudulent billings. That money is better spent paying for the medical needs of legitimate patients."

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