Tuesday, July 31, 2007

Oakland City University Settles Admissions Incentives Fraud Case

Indiana’s Oakland City University has settled a civil case that accused the school’s admissions office of paying incentives to admissions recruiters and then failing to report these payments to the federal government.  The university will pay $5.3 million to settle the case, with $1.4 million going to Jeffrey Main, who was the whistleblower in the case.

Main, Oakland City University’s former director of admission, brought the suit against the school four years ago.  Main, like other employees, was paid a base salary plus incentives, based on his success securing enrolling students.

During his tenure at the school, Main discovered that the university’s policy of paying incentives was in direct contradiction to guidelines set in agreements that the university filed with the federal government.  Jill Zengler, chief of the civil division of the U.S. State’s Attorneys office, explained that universities must certify that they are not paying financial incentives to recruiters in order to receive higher education funding from the Department of Education.

Click on the following link to read Kate Braser’s article from the Courier Press about Oakland City University’s Admissions Incentives Fraud Settlement.

Monday, July 30, 2007

Big Dig Concrete Fraud Settled for $50 million

Aggregate Industries NE Inc., the supplier of 5,700 truckloads of concrete to Boston’s Big Dig project, has pleaded guilty to providing substandard concrete.  They have agreed to pay $42 million to settle a civil investigation, and $8 million in criminal fines. 

The company was accused of knowingly using over-age concrete and falsifying documents to cover this scheme.  Concrete must be used within 90 minutes of being mixed.  Over-age concrete begins to harden and may not solidify properly.  Records show that 5,700 truckloads provided by Aggregate were over-age.  This concrete represents about 2 percent of the concrete used in the Big Dig.

Four Aggregate employees will be rewarded for blowing the whistle.  Three, who filed suits in 2005, will share $2.7 million.  The fourth, who filed a suit in 2006, will receive $75,000.

Click hear to read Sean P. Murphy’s Boston Globe article about Big Dig payment for fraud at $50 million.

Friday, July 27, 2007

Florida Neurosurgeon Settles Whistleblower Case

Miami’s U.S. Attorney’s Office announced this Thursday that a Florida board-certified neurosurgeon and the hospital for whom she worked have agreed to settle allegations that she performed unnecessary spinal surgeries on Medicare patients.  They have agreed to pay the federal government $1.275 million.

Thomas Gayeski, an anesthesiologist at the hospital, filed a whistleblower lawsuit against Dr. Linda I. Bland, saying that she performed more than 150 unnecessary surgeries at the Sebastian River Medical Center.  The surgeries were performed between 2000 and 2002.

U.S. Attorney R. Alexander Acosta said, “Unnecessary surgeries are not only fraudulent, but unconscionably expose patients to needless medical risks.”

Under the terms of the settlement, the hospital paid $925,000 and Bland paid $350,000.  As the whistleblower, Gayeski will receive $230,000.

Click here to read John Dorschner’s Article in the Miami Herald about the Unnecessary Back Surgery Settlement.

Thursday, July 26, 2007

NJ Supreme Court Rules in Favor of Former Prudential Contractor

The NJ Supreme Court ruled yesterday that independent contractors are entitled to the same whistleblower protections under state law as traditional employees.

George D’Annunzio was hired to work as a part-time chiropractic medical director in the personal injury protection department of a Prudential Financial Unit in February of 2000.  That summer, he told supervisors that he believed there were insurance violations occurring in the department.  D’Annunzio was fired by Prudential that September.

In a 5-1 decision the NJ Supreme Court agreed with an Appellate Court rulting that D’Annunzio was entitled to sue Prudential Property and Casualty insurance under the NJ Concientious Employee Protection Act.  This overturned an earlier ruling which stated that independent contractors were not eligible for the same protections as regular employees.

Click here to read Greg Saitz’s article on nj.com, [url= http://www.nj.com/news/index.ssf/2007/07/court_rules_in_favor_of_former.html]Court Rules in Favor of Former Prudential Contractor[url].

Tuesday, July 24, 2007

Virginia-based Maximus Inc. Enters Deferred Prosecution and Pays $30.5 M

The U.S. Attorney’s Office for the District of Columbia and the Justice Departments Civil Division have reached a criminal deferred prosecution agreement and a civil False Claims Act with Virginia-based Maximus Inc.

Maximus Inc. had been contracted by the District of Columbia’s Child and Family Services Agency (CFSA) to submit claims to Medicaid for services provided by the District to children in its foster care program.  Allegedly, Maximus’ employees decided to cause CFSA to submit claims for all children in the District’s foster care program, regardless of whether or not services had been provided to those children.

Benjamin Turner, a former division manager at Maximus, prompted the investigation into the allegations against Maximus.  Mr. Turner filed the suit under the qui tam provisions of the False Claims Act, and will receive $4.93 million as his share of the settlement.

Click here to read the press release regarding the Maximus Medicare Fraud Story.

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