Preet Bharara, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Dennis Rosen, Inspector General of the New York State Office of the Medicaid Inspector General (“OMIG”), announced the unsealing today of a superseding indictment charging physicians MUSTAK Y. VAID, PAUL J. MATHIEU, and EWALD J. ANTOINE, as well as health-care executives MARINA BURMAN, ASHER OLEG KATAEV, a/k/a “Oleg Kataev,” and ALLA TSIRLIN with operating a $33 million health care fraud scheme through the operation of eight fraudulent medical clinics in Brooklyn, as well as the operation of related suppliers of medical equipment, tests, and services. As part of the fraud scheme, the defendants’ co-conspirators paid cash kickbacks to elderly and financially disadvantaged patients (the “Paid Patients”) who were insured by Medicare and/or Medicaid, and the defendants and their co-conspirators then billed Medicare and Medicaid for unnecessary medical services, tests, and supplies related to the Paid Patients.

VAID was previously indicted and arrested on these charges in November 2016. MATHIEU, ANTOINE, BURMAN, KATAEVE, and TSIRLIN were arrested earlier today and presented and arraigned this afternoon before U.S. Magistrate Judge Kevin Nathaniel Fox. The case is assigned to U.S. District Judge Lorna G. Schofield.

U.S. Attorney Preet Bharara said: “These defendants allegedly operated fraudulent medical clinics and suppliers in a scheme that bilked Medicare and Medicaid out of more than $30 million. As alleged, three of the defendants were doctors who, in violation of their Hippocratic oath, signed medical charts for patients they never treated and prescribed unnecessary medications, procedures, and supplies. Medicare and Medicaid were established to assist the elderly and economically disadvantaged, not to serve as cash cows for allegedly corrupt professionals.”

FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “In this case, as alleged, Medicare and Medicaid programs suffered millions of dollars in losses when a group of physicians and health-care executives created, operated, or became associated with eight fraudulent medical clinics. As charged, their litany of crimes included paying a series of kickbacks, writing scripts for unnecessary medical tests, and arranging transportation services for patients who didn’t need a ride. Today’s charges certainly won’t prove to be a cure for all ills, but they are a step in the right direction when it comes to confronting the threats faced by the health care system.”

Medicaid Inspector General Dennis Rosen said: “This joint investigation and today's arrests send an unmistakable message. Those who seek personal gain by preying upon vulnerable New Yorkers and exploiting the Medicaid program will be held fully accountable. My office will continue to work closely with our partners in the U.S. Attorney’s Office, FBI and other state and federal agencies to root out fraud, waste and abuse in the Medicaid program.”

As alleged in the Indictment unsealed today and according to statements made in Court today: [1] Aleksandr Burman, an individual with no medical license, established eight medical clinics in Brooklyn (the “Related Clinics”), which operated between 2007 and 2013. For each clinic, Aleksandr Burman hired one of three doctors – VAID, MATHIEU, or ANTOINE – to pose as the nominal owner of the clinic, since New York State law requires that a professional services corporation providing medical care must be owned by a medical professional. In fact, however, VAID, MATHIEU, and ANTOINE were each simply hired by Aleksandr Burman to pose as the owner of one or more of the clinics, and to come to the clinic periodically, in order to sign medical charts falsely stating that the doctor had examined a number of Paid Patients. VAID posed as the owner of one such clinic, while MATHIEU posed as the owner of four others, and ANTOINE posed as the owner of the remaining three. The three doctors were also paid to provide a large number of prescriptions and referrals for medically unnecessary supplies. Such unnecessary prescriptions included referrals for more than $3.5 million worth of durable medical equipment (“DME”), consisting mostly of incontinence supplies such as adult diaper sets ordered from a DME supply company (“USD”) owned jointly by BURMAN and Aleksandr Burman of the Related Clinics. Many of the Paid Patients who received such prescriptions and referrals did not need or receive the diapers and other supplies. Instead, BURMAN and USD arranged for the Paid Patients to exchange their diaper prescriptions for valuable merchandise, such as bed linens, tablecloths, dishes, kitchen appliances, and other housewares. BURMAN and USD nonetheless filed Medicaid claims for such DME, seeking more than $3.5 million in reimbursement. BURMAN also transported cash to the Related Clinics to be used to pay kickbacks to the Paid Patients. VAID, MATHIEU, ANTOINE, and their co-conspirators also provided medical referrals for transportation services to hundreds of Paid Patients, even though such transportation was not medically necessary. This practice generated more than $4 million in losses to Medicaid. In addition, VAID, MATHIEU, and ANTOINE provided referrals and prescriptions for medically unnecessary diagnostic tests, including MRIs, as well as prescriptions for medications such as expensive ointment compounds. The defendants and their co-conspirators then sent such medical referrals to specific medical testing companies, which in turn provided kickbacks to Aleksandr Burman. In 2012, KATAEV and TSIRLIN became business partners of Aleksandr Burman, and operated as the managers of two of the Related Clinics. Their activity as managers included paying cash kickbacks directly to Paid Patients, and employing MATHIEU and ANTIONE to pose as the owners of the two clinics. In or about March 2016, Aleksandr Burman pled guilty for his role in these offenses. He is scheduled to be sentenced on February 15, 2017, before the Honorable Paul G. Gardephe.

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VAID, 43, of Brownstown Township, Michigan, MATHIEU, 51, of Morristown, New Jersey, ANTOINE, 66, of Valley Stream, New York, BURMAN, 54, of Manhattan, KATAEV, 48, of Staten Island, and TSIRLIN, 46, of Brooklyn, are all charged with: (1) conspiring to commit health care fraud, mail fraud, and wire fraud, which carries a maximum sentence of 20 years in prison; (2) the substantive offenses of mail fraud and wire fraud, each of which carries a maximum sentence of 20 years in prison; (3) the substantive offense of health care fraud, which carries a maximum sentence of 10 years in prison; and (4) conspiring to make false statements relating to a federal health care program, which carries a maximum penalty of five years in prison. BURMAN, KATAEV, and TSIRLIN are also charged with conspiring to violate the Anti-Kickback Statute, which has a maximum penalty of five years in prison. The statutory maximum sentences are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.

Mr. Bharara praised the investigative work of the New York FBI’s Health Care Fraud Task Force.

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney David Raymond Lewis is in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.