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Date: 10-14-2014
Case Style: United States of America v. Kenneth Karow, Hermann J. Diehl, and Hal Mark Kreitman
Case Number: 9:11-cr-80106-KAM
Judge: Kennth A. Marra
Court: United States District Court for the Southern District of Florida
Plaintiff's Attorney: A. Marie Villafaña and E.J. Yera
Defendant's Attorney: Martin Juan Beguiristain for Joanquin Ross
James Scott Benjamin for Veronica Riofrio
Barry Butin for Yeisy Chouza
Libio Calejo for Oscar Luis Franco Padron
Bradford M. Cohen for Juan Francisco Avon
Michael Bruce Cohen for Daviel Castro Martinez
Jeffrey L. Cox for Abner Llenderrozo
Richard Francis Della Fera for Yida Bello
James L. Eisenberg for Alien Moya
Michael James Entin for Teresita Mena
Robert Steven Franklin for Oscar Montiel Martinez
Jonathan S. Friedman for Noelia Marichal
Randee J. Golder for Kenneth Karow
Avelino Jose Gonzalez for Joaquin Ross
Irving Joseph Gonzalez for Gloria Patricia Cintron
Herbert Dongjin Kim for Joel Antonio Simon Ramirez
Richard Carroll Klugh, Jr. for Hal Mark Kreitman
Gregg Stuart Lerman for Yanet Hernandez Marichal
Christopher Gerard Lyons for Maria Testa Baceiro
Patrick R. McKamey for Yenisleydi Ramos
Edward Donald Reagan for Helenne Vazquez
Phillip Louis Reizenstein for Hermann J. Diehl
John J. Richardson for Carmen Venegas
Robin Cindey Rosen-Evans - FPD for Juan Oviedo
Richard L. Rosenbaum for Lawrence Schechtman
Richard Aldo Serafini for Nelson Felix Martinez Torres
Samuel J. Smargon - FPD for Lisbet Leon
Michael Gary Smith for Maykel Marquez
Robert William Stickney for Oreste Roland Chavez
Lawrence U. Taube for Elias Sebastian Munguia
Grey Tesh for Amaury Tomas Contino
Jan Peter Weiss for Wilfredo Saucedo
Russell Jay Williams for Aleida L. Capdevila
Saam Zangeneh for Luis Ivan Hernandez
Description: Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Jeff Atwater, Florida Chief Financial Officer, and Dave Aronberg, State Attorney, Office of the State Attorney for Palm Beach County, announce that defendants Kenneth Karow, 54, chiropractor, of West Palm Beach, Hermann J. Diehl, 44, chiropractor, of Miami, and Hal Mark Kreitman, 50, former chiropractor, of Miami Beach, were sentenced before U.S. District Judge Kenneth A. Marra for their participation in a massive staged automobile accident scheme based in Palm Beach and Miami-Dade Counties.
Defendant Karow was sentenced to 11 years in prison; defendant Diehl was sentenced to nine years in prison; and defendant Kreitman was sentenced to eight years in prison.
After a seven-week trial before U.S. District Judge Kenneth A. Marra, a federal jury in West Palm Beach convicted all of the defendants of one count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 1341, all in violation of Title 18, United States Code, Section 1349; and one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Sections 1956(a)(1), all in violation of Title 18, United States Code, Section 1956(h). Defendant Karow was convicted of 48 substantive counts of mail fraud, in violation of Title 18, United States Code, Sections 1341 and 2, and 11 substantive counts of money laundering, in violation of Title 18, United States Code, Sections 1956(a)(1)(A)(i), 1956(a)(1)(B)(i), 1956(a)(1)(B)(ii) and 2. Defendant Diehl was convicted of two substantive counts of mail fraud and three substantive counts of money laundering. Defendant Kreitman was convicted of 21 substantive counts of mail fraud and two substantive counts of money laundering.
According to the fourth superseding indictment, these defendants were charged with defrauding insurance companies out of Personal Injury Protection (“PIP”) insurance payments through the use of the United States Mails. This indictment alleges that the fraud was committed in a number of ways, including: (1) by soliciting licensed chiropractors, including defendants Karow and Diehl, who would serve as the “named owners” of chiropractic clinics although others would maintain financial control over the businesses in order to avoid Florida’s licensing restrictions; (2) by recruiting individuals to participate in staged automobile accidents or persons who had been in real automobile accidents but who had not suffered any injuries to attend chiropractic clinics and make claims for reimbursement for treatments that were neither needed nor received; (3) submitting fraudulent claims to insurance companies stating that the bills were for treatments that were medically necessary and were actually received when neither was true; (4) submitting claims to insurance companies without attempting to collect co-pays and deductibles from the insureds and without disclosing that fact to the insurance companies; and (5) converting the money collected from the insurance companies to cash which would be used to pay recruiters, patients, and other participants, and to enrich the members of the conspiracy.
This superseding indictment was the latest in a series of federal and state charges that have been part of a four-year investigation into a massive staged automobile accident/fraudulent chiropractic clinic scheme based in Palm Beach and Miami-Dade Counties. The joint federal and state law enforcement investigation, dubbed Operation Sledgehammer, has resulted in charges filed against 93 defendants for their participation in this automobile insurance fraud scheme. Of those 93 defendants, 57 have been charged federally by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $11 million to the defrauded insurance companies, and 51 of those 57 defendants have been convicted by jury or by guilty plea. The remaining six defendants are fugitives. Another thirty-six defendants have been charged by the Palm Beach County State Attorney’s Office.
According to the evidence presented at trial, between October 2006 and December 2012, the defendants and their co-conspirators staged automobile accidents and thereafter caused the submission of false insurance claims through chiropractic clinics they controlled. To execute the scheme, the true owners of the chiropractic clinics allegedly recruited individuals, who had the medical or chiropractic licenses required by the state to open a clinic, to act as “nominee owners” of the clinics. The defendants also recruited individuals, whom they referred to as “Macho” and the “Hembra” or the “Perro” and “Perra,” to participate in the accidents, and others to help the clinics launder the insurance proceeds. The defendants also hired complicit chiropractors, including Diehl, Karow and Kreitman, and therapists who prescribed and billed for unnecessary treatments and/or for services that had not been rendered. Thereafter, complicit clinic employees prepared and submitted claims to the automobile insurance companies for payment for these unnecessary or non-rendered services. Twenty-one clinics participated in this scheme.
Mr. Ferrer commended the efforts of the FBI, IRS-CI, the Florida Division of Insurance Fraud, the Palm Beach County State Attorney’s Office, and the Greater Palm Beach County Health Care Fraud Task Force for their outstanding work in this case. Mr. Ferrer also recognized the National Insurance Crime Bureau (NICB) for its collaboration and assistance in this investigation.
Outcome: See Above
Plaintiff's Experts:
Defendant's Experts:
Comments: