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Date: 10-24-2020
Case Style:
Case Number: 2:20-cr-00077
Judge: Irene C. Berger
Court: United States District Court for the Southern District of West Virginia (Kanawha County)
Plaintiff's Attorney: United States District Attorney’s Office, Charleston, West Virginia
Defendant's Attorney:
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Description: Charleston, West Virginia health care fraud criminal defense lawyer represented Edward Stephen, age 61, who was charged by the United States of America with health care fraud.
“When federal workforce programs are defrauded, it comes at great cost to taxpayers,” said United States Attorney Mike Stuart. “I appreciate the work of the U.S. Department of Transportation OIG and Office of Personnel Management OIG investigators in this case. We will continue to work with our law enforcement partners to suss out fraud schemes, hold perpetrators accountable and seek restitution for victims.”
Stephen was a federal employee with the U.S. Department of Transportation Federal Highway Administration. As a federal employee, he was eligible for health insurance provided by the federal government. Stephen fraudulently enrolled extended family members into his federal health care plan, knowing they were not eligible for federal health care benefits. Specifically, Stephen enrolled his sister as though she was his wife and his niece as though she was his step-child so that they would obtain federal health care coverage they were not entitled to receive. This scheme lasted from 2005 to 2017 and included several years where Stephen resided in and worked in Charleston as a federal employee. When investigators learned of the fraud, Stephen gave a statement to investigators with the Department of Transportation Office of Inspector General. In his statement, Stephen admitting that he fraudulently placed his extended family members on his federal insurance knowing they were not entitled to receive benefits. In total, the Court found that the government was defrauded out of $108,411.59 in fraudulent premium payments and reimbursements.
“Federal employees who engage in fraud related to aspects of their employment erode public confidence in the high standard of integrity to which they are held,” said Jamie Mazzone, regional Special Agent-In-Charge, Department of Transportation Office of Inspector General. “Today’s sentencing illustrates our commitment to working with our law enforcement and prosecutorial partners to root out schemes that illegally take advantage of Federal workforce programs and benefits.”
“Healthcare fraud takes many forms, including knowingly enrolling ineligible individuals in the FEHBP,” said Norbert E. Vint, Deputy Inspector General Performing the Duties of the Inspector General, OPM OIG. “Through his fraudulent conduct, the defendant stole from the Federal Government and the American taxpayer. Today’s sentencing is an important step towards accountability and I applaud the hard work of the OPM OIG investigative staff and our Department of Justice partners on this case.”
Stuart praised the work of the U.S. Department of Transportation Office of Inspector General (DOT OIG) and the Office of Personnel Management Office of Inspector General (OPM OIG). The investigation was conducted by members of the United States Attorney’s Healthcare Fraud Abuse, Recovery and Response Team (ARREST), an approach linking civil and criminal enforcement efforts together in a comprehensive attack on the opioid epidemic and healthcare fraud. United States Attorney Mike Stuart announced the formation of ARREST in February 2019. All health care related cases in the Southern District of West Virginia, whether they are the subject of criminal or civil investigation or enforcement, are directed through ARREST. Included within the purview of the team are the Opioid Fraud and Abuse Detection Unit, Affirmative Civil Enforcement Unit, Appalachian Regional Prescription Opioid (ARPO) Strike Force, Medicare and Medicaid Fraud, and Asset Forfeiture efforts related to all healthcare matters.
United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorney Erik S. Goes handled the prosecution.
Outcome: Defendant was sentenced to 24 months of probation with the condition that the first six months be served on home confinement, and a fine of $10,000, for a federal health care fraud violation. He was also ordered to pay restitution of $108,411.59, a sum of money that Stephen has already paid over to the United States District Court Clerk to be immediately applied to the fraud loss.
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