Owner of Home Health Agency Sentenced in Absentia to 80 Years in Prison for Involvement in $13 Million Medicare Fraud Conspiracy and for Filing Fraudulent Tax Returns
The owner of a Houston home health agency was sentenced to 80 years in prison for his role in a $13 million Medicare fraud scheme and for filing false tax returns.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Acting U.S. Attorney Abe Martinez of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Dallas Region and Special Agent in Charge D. Richard Goss of the Houston Field Office of the Internal Revenue Service Criminal Investigation (IRS-CI) made the announcement.
Ebong Tilong, 53, of Sugarland, Texas, was sentenced by U.S. District Judge Melinda Harmon of the Southern District of Texas. In November 2016, after the first week of trial, Tilong pleaded guilty to one count of conspiracy to commit healthcare fraud, three counts of healthcare fraud, one count of conspiracy to pay and receive healthcare kickbacks, three counts of payment and receipt of healthcare kickbacks, and one count of conspiracy to launder monetary instruments. In June 2017, Tilong pleaded guilty to two counts of filing fraudulent tax returns. Tilong failed to appear for his original sentencing, which was scheduled for Oct. 13, 2017.
According to the evidence presented at trial and Tilong’s admissions in connection with his guilty plea, from February 2006 through June 2015, Tilong and others conspired to defraud Medicare by submitting over $10 million in false and fraudulent claims for home health services to Medicare through Fiango Home Healthcare Inc. (Fiango), owned by Tilong and his wife, Marie Neba, 53, also of Sugarland, Texas. The trial evidence showed that using the money that Medicare paid for such fraudulent claims, Tilong paid illegal kickbacks to patient recruiters for referring Medicare beneficiaries to Fiango for home health services. Tilong also paid illegal kickbacks to Medicare beneficiaries for allowing Fiango to bill Medicare using beneficiaries’ Medicare information for home health services that were not medically necessary or not provided, the evidence showed. Tilong falsified medical records and directed others to falsify medical records to make it appear as though the Medicare beneficiaries qualified for and received home health services. Tilong also attempted to destroy evidence, blackmail a witness, and suborn perjury from witnesses, including a co-defendant while in the federal courthouse, the evidence showed.
According to the evidence presented at trial and his admissions to the tax offenses, from February 2006 to June 2015, Tilong received more than $13 million from Medicare for home health services that were not medically necessary or not provided to Medicare beneficiaries.
In connection with his guilty plea to the tax offenses, Tilong admitted that to maximize his gains from the Medicare fraud scheme, he created a shell company called Quality Therapy Services (QTS) to limit the amount of tax that he paid to the IRS on the proceeds that he and his co-conspirators stole from Medicare. According to his plea agreement, in 2013 and 2014, Tilong wrote almost a million dollars in checks from Fiango to QTS, purportedly for physical-therapy services that QTS provided to Fiango’s Medicare patients. The evidence showed that QTS did not provide those services. According to his plea agreement, in 2013 and 2014, Tilong’s fraudulent tax scheme caused the IRS a tax loss of approximately $344,452.
To date, four others have pleaded guilty or been convicted based on their roles in the fraudulent Medicare scheme at Fiango. Nirmal Mazumdar, M.D., of Houston, Texas, the former medical director of Fiango, pleaded guilty to a scheme to commit health care fraud for his role at Fiango. Daisy Carter, 58, of Wharton, Texas, and Connie Ray Island, 49, of Houston, Texas, two patient recruiters for Fiango, pleaded guilty to conspiracy to commit health care fraud for their roles at Fiango. Neba was convicted after a two-week jury trial of one count of conspiracy to commit health care fraud, three counts of health care fraud, one count of conspiracy to pay and receive health care kickbacks, one count of payment and receipt of health care kickbacks, one count of conspiracy to launder monetary instruments and one count of making health care false statements.
On Aug. 11, Neba was sentenced to 75 years in prison and Island was sentenced to 33 months in prison. On Oct. 3, Mazumdar was sentenced to time served with three years of home confinement. Carter is awaiting sentencing.
The case was investigated by the FBI, IRS-CI and HHS-OIG under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas. The case is being prosecuted by Trial Attorney William S.W. Chang, Senior Trial Attorney Jonathan T. Baum, and Trial Attorney Andrew Pennebaker of the Fraud Section.
The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.