Medical clinics run by convict

A national chain of erectile dysfunction clinics is headed by a man who spent time in federal prison for fraud and who has been called a con man and a scam artist by the Federal Trade Commission, an Enquirer investigation has uncovered.

A review of internal documents, emails and copies of training videos shows that management with Physicians E.D. – which has a clinic in Sharonville – has:

• Suggested firing physicians who voice concerns that treatment protocol could be dangerous for patients.

• Pushed employees to sell 12 to 18 months’ worth of medication, costing upwards of $6,000. Former employees say the company has focused more on pushing sales than on patients’ medical needs.

• Paid its staffers between 4 percent and 7 percent commission on medication sales.

• And trained its staff to tell patients the medication works “100 out of 100 times.”

Physicians E.D. materials feature prominently a man identified as “Rick N.” The Enquirer forwarded video stills of the man to two federal authorities, who confirmed that he is Richard C. Neiswonger, whose legal battles began in 1996 with federal agencies for deceptive business practices and get-rich-quick schemes.

Neiswonger has been sued several times in various federal courts, did federal prison time in the late 1990s on fraud charges and is currently awaiting sentencing after pleading guilty in 2012 to mail fraud and conspiracy to defraud the U.S. government.

Several former employees said that they didn’t know about Neiswonger’s criminal past until after they were fired or laid off. Some said they were uncomfortable with the company’s sales tactics but stayed because of the hefty paychecks. “I had patients all the time who wanted to return the medication, and we’d say ‘you can’t,’” said Matt Jones, a medic hired to work in the Kansas City clinic. “That’s not why I got into this field. I’m honestly glad they got rid of me, because I can’t be a part of that.”

Clinic representatives say that their top priority is patient care. They’ve successfully treated thousands of men nationwide, they say, and the concerns raised to The Enquirer come from disgruntled past employees.

Neiswonger was permanently banned in 1997 from engaging in any type of deceptive telemarketing by the FTC. He’s since been sued for contempt twice by the agency – once for violating the permanent injunction, and again for violating a 2008 civil contempt order. He also was involved with another series of erectile dysfunction clinics that is being sued by the Massachusetts attorney general.

Solomon Wisenberg, Neiswonger’s attorney, told The Enquirer that his client is one of several people involved in operating Physicians E.D., and that it’s natural for a man with a criminal record not to want to disclose that past to consumers.

“There’s no disclosure requirement that I’m aware of when somebody pled guilty 15 or 20 years ago to fraud and has paid his debt to society,” Wisenberg said. “Rick has admitted that he’s made mistakes in the past. He’s trying to turn his life around, and as long as he’s not required to reveal, I don’t see why he would.”

Wisenberg acknowledged that Neiswonger hasn’t “paid his debt” for his most recent guilty pleas in Nevada, for which he’s yet to be sentenced. Neiswonger is cooperating with investigators in that case, his lawyer said, and is expected to provide helpful information to the government for an upcoming trial.

Convict’s name kept off clinic’s filings

The Enquirer began reporting on Physician E.D.’s advertisements in March. Those stories uncovered nearly a dozen complaints from patients at the Sharonville location who said they were subjected to high-pressure sales tactics for treatments that they ultimately didn’t want.

Neiswonger’s name doesn’t appear on public filings connected with the Yale Clinic, which is the name of the parent company that operates Physicians E.D. in eight locations: Cincinnati; Pittsburgh; Kansas City; Fort Myers, Fla.; Cherry Hill, N.J.; Salt Lake City; Atlanta, and Hartford, Conn. It also operates the Huntington Medical Clinic in Metairie, La.

Former employees interviewed by The Enquirer said Neiswonger is one of the outfit’s bosses, and “Rick N.” is listed as director of marketing on company directories provided by one of the former employees. Neiswonger also appears in a training video, introducing himself by his full name.

The FTC declined to comment for this story. In past news releases, the agency has called Neiswonger a “business opportunity con artist” and a “scammer” with a history of deceiving consumers. Neiswonger reached a settlement in 2011 with the FTC that required him to surrender his Las Vegas home, valued at more than $1 million. The agency has banned Neiswonger from misrepresenting or failing to disclose “material facts” when promoting any business program.

Wisenberg said Neiswonger isn’t violating the FTC’s permanent injunction. “He’s entitled to earn a living, he does it properly, and everybody deserves a chance to do that,” Wisenberg said.

Past employees interviewed by The Enquirer said the business is focused more on making money than patient care – an allegation the clinic’s medical director denies. The employees pointed to concerns some physicians and medics raised about the company’s guidelines about treating men with elevated blood pressure.

Treating hypertensive patients for erectile dysfunction isn’t on its own problematic, but the antidotes used to reverse erections that last too long are known to raise blood pressure. In June, Physicians E.D. disseminated guidelines that call for doctors to treat patients with blood pressures as high as 220/120 – far higher than the threshold for hypertension, which is generally considered to be 120/80.

Daniel Meade, 23, of West Chester, is trained as a paramedic and worked with Physicians E.D. until early June. He said that physicians and medics who voiced concerns about treating hypertensive patients were threatened with firing.

“If I, as a paramedic, come up to a scene and someone’s 219/119, we’re going really quickly to a hospital, because he’s at risk for a stroke,” he said. “At the clinic, he’s treated for ED.”

In a written statement to The Enquirer, Physicians E.D. Medical Director Michael Trombley denied that hypertensive patients are put at risk by the clinic’s guidelines.

“Patients with hypertensive emergency will ALWAYS be immediately directed to an ER and will NEVER be given ED treatments until that is resolved,” he said.

Emails obtained by The Enquirer indicate that Neiswonger threatened to “weed out” and “terminate” physicians who refused to treat hypertensive patients. However, Trombley said that “no physician or medic has ever been fired due to voicing concerns over a treatment protocol that could be dangerous for patients. In fact, it is actually the opposite, a physician or medic would be potentially fired for NOT following safety treatment protocols that could possibly endanger patient care.”

‘It’s all a staged performance’

Employees of Physicians E.D. are shown training videos on dealing with patients. In one video, a Cincinnati staffer describes how he interacts with patients. “It’s all a staged performance meant to boost my sales,” Matt Kochersperger says in the video. Later, Kochersperger says he asks each patient to see their driver’s license. “I do that so we have an ID, but I’m also doing that so I can see what credit cards he has in his wallet,” he says.

Kochersperger declined to talk to The Enquirer, referring questions to Physicians E.D.’s corporate office.

In a provided audio recording of another video, Neiswonger gives step-by-step instructions to staffers on how to close a sale. The patient “is sitting there with an erection for perhaps the first time ever ... How hard of a sale could this really be?” Neiswonger says. “Not very hard. Our job is to get him to enroll in our treatment plan for a long period of time, 12 to 18 months, so he can properly restore function.”

Neiswonger instructs staffers to tell patients that they should be having sex three to five times a week, to assure them that the penile injections are better than pills such as Viagra, and to say that the treatment is effective “100 out of 100 times.”

Roy Guthrie is one of the former employees who spoke with The Enquirer. He ran the company’s Pittsburgh clinic until he was fired June 17. He said a series of Enquirer stories posted at Cincinnati.com caused him to start questioning the efficacy and safety of the medications being prescribed.

“They were making these claims about the treatment, and at first, I thought, ‘OK, the doctors are on board, so this isn’t a problem.’ (The Enquirer’s) articles that came out made me raise an eyebrow,” he said.

Part of his concern stemmed from staffers earning commission on sales, he said. The commission rate ranges from 4 percent to 7 percent, depending on the clinic’s overall sales for the week. That gives staffers incentive to push elderly patients into long-term treatment plans they might not want or need, and the company’s contracts make refunds difficult, Guthrie said.

After The Enquirer’s stories ran, Guthrie said that management told employees to downplay the issues raised and even branded one clinic with a different name – Huntington Men’s Clinic – to ensure that the stories didn’t pop up when potential customers did online research.

“I started questioning things like that,” Guthrie said. ‘I said, ‘Why are we hiding? When a patient calls to complain and threatens to go to the (Better Business Bureau), why are we giving them their money back if we did nothing wrong?’”

Not Neiswonger’s first ED clinic

This isn’t Neiswonger’s first foray into the business of treating erectile dysfunction. He is mired in a legal battle related to a similar venture called Men’s Medical Clinic, another series of erectile dysfunction clinics that became the target of a class-action lawsuit filed in December.

Massachusetts Attorney General Maura Healey earlier this month filed a lawsuit against Men’s Medical, accusing it of using deceptive marketing and high-pressure sales tactics. Healey’s complaint alleges that more than 4,000 consumers paid more than $5 million to one clinic in Framingham, Mass.

Neiswonger isn’t publicly attached to Men’s Medical, but, in a civil suit filed in Orange County, Fla., his wife claims that she is equal owners with medical director Kevin Hornsby. Shannon Neiswonger accuses Hornsby in the suit of “fraud and deceit” designed to steal her ownership in the “profitable and successful” business.

In an email to coworkers, Neiswonger in May referenced a settlement between Hornsby and his wife. He wrote that the Yale Clinic was set to “acquire the following assets and markets,” and listed Washington, D.C., Detroit, Cleveland and Philadelphia. He closed the email with, “Our plate is full.”

However, the Florida suit indicates that the settlement deal fell through. The next hearing on the matter is set for July 21.

After The Enquirer’s stories about Physicians E.D. ran, the one-time face of that business – Muni Sheldon Polsky, a urologist in Florida – was replaced in June by Trombley, a family practitioner licensed in North Carolina.

Polsky refused to comment on his departure to The Enquirer. “Why would I tell you personal things about myself?” he asked, before hanging up the phone.

Polsky’s image, name and introductory videos were stripped from the Physicians E.D. websites and replaced by Trombley’s. One video features Trombley reciting the same script, word for word, that Polsky had – right down to claiming that he wrote a pamphlet called “Seven Secrets Doctors and Drug Companies Don’t Want You to Know About Erectile Dysfunction.” (Watch a video showing the similarity at Cincinnati.com.)

High-pressure sales, controversial treatments

Trombley serves as the physician face of the company, but each location also has one or two locally hired physicians on staff as well. Meade said that those physicians take a medical history of each incoming patient, but the penile injection is administered by an on-site paramedic or emergency medical technician.

If the patient has an adverse reaction to the injection, staffers are instructed to call Yale headquarters, where David Vitelli serves as national medical operations director.

Customers who aren’t satisfied with the medication or who try to back out of the purchase are largely rebuffed, according to past employees. In one email provided to The Enquirer, managers discussed a patient who complained that the medication he ordered arrived after its expiration date. He was told that a refund wasn’t possible, according to the email.

In another email, Vitelli threatened to fire a physician who had concerns about andropause cream – a controversial treatment that Trombley said is “helpful for erections and overall well-being.” The physician didn’t believe the cream was beneficial and wasn’t selling enough of it, Vitelli wrote in the email.

“Unfortunately, if he can not push it, it will be a big problem. I may have to replace him,” Vitelli wrote. In response to a question about the email, a company spokesman released this statement: “David Vitelli adamantly denies ever stating that a physician would be terminated for not ‘pushing’ any particular medication or treatment.”

Meade, the West Chester paramedic, formerly worked for Vitelli as national medical operations manager. He said the clinic buys the cream for $160 from Olympia Pharmacy in Orlando, and sells it to patients for $900 – a 463 percent markup.

“It was all about selling the product, about making money,” former employee James Johnson told The Enquirer. “That was their sole purpose.”

Johnson worked at the company’s headquarters before it relocated last month to Pennsylvania. He sat in the call center, he said, and listened to employees pitching the treatment to customers nationwide.

“Every week, once a morning, we’d have a staff phone call, and it was all sales, sales, sales. No talk of helping the patient,” said Johnson, who described his eventual departure a “relief.” “I knew this was definitely not good for the old people. It was a sham. It was a time-share, high-pressure sale that a lot of these poor old guys were getting stuck with.”

Trombley said that because of The Enquirer’s queries, the clinic is examining its marketing material, manuals and handouts to make sure all information is accurate. For example, he said, it is nixing wording that instructs staffers to tout the treatment as being effective “100 out of 100 times.”

“We never want information to be construed as misleading,” he said.

Richard Neiswonger: A Timeline

After working as a semi-professional magician through the ‘60s and ‘70s under the stage names “Slick Rick” and “Ricky Penn,” Neiswonger later had a magical variety show with his wife called “Captain Space and Solar Sue.” He later switched his focus to businesses that ran afoul of the Federal Trade Commission and other federal authorities.

Here’s a sampling of his run-ins with law enforcement, beginning in the 1990s:

• 1996: The Federal Trade Commission targets Neiswonger and several businesses he started for fraud and deceptive practices. The agency says Neiswonger marketed and sold business training courses throughout the U.S. The courses cost up to $12,900 and representatives promised clients that they’ll ultimately earn $150,000 a year. In reality, many clients don’t recoup the cost for the courses, much less earn the “doctor’s income” that Neiswonger promised.

• 1997: The FTC issues a permanent injunction banning Neiswonger from engaging in deceptive telemarketing. The injunction prohibits Neiswonger from misrepresenting or failing to disclose “material facts” when promoting any business program.

• 1998: Neiswonger is sentenced to 18 months in federal prison after pleading guilty to money laundering and wire fraud charges.

• 2006: The FTC files to freeze Neiswonger’s assets, accusing him of violating the permanent injunction through his involvement with Asset Protection Group, Inc., which charged clients $10,000 to hide their financial assets from the IRS and other government agencies, creditors and courts. Neiswonger’s cohort in that eight-year venture is William Reed, a former Colorado lawyer.

Richard Neiswonger to forge his wife’s signature on an operating agreement in late 2013.

About this story

This story came about because of a complaint filed with Enquirer Call For Action reporter Amber Hunt. For help with consumer mediation, call our hotline from 11 a.m.-1 p.m. Monday through Friday at 513-768-8833 or fill out this form online at https://www.cincinnati.com/callforaction.

• 2007: The FTC announces that Neiswonger is banned for life from selling any type of business program in the future. In a news release, the agency calls him a “scam artist” who falsely claimed consumers could make six-figure incomes by buying his $10,000 business program.

• July 2011: Neiswonger, Reed and accountant Wendell Waite are federally indicted on multiple charges, including conspiracy to defraud, mail fraud, wire fraud and money laundering. They’re accused of making more than $60 million in the asset protection scheme. Reed pleads guilty in 2012 to conspiracy to defraud the United States, aggravated identity theft and evasion of tax payment. He is sentenced to 9 years in prison.

• November 2011: Neiswonger and his second wife Shannon are indicted alongside Colorado attorney Robert McAllister on financial fraud charges. Neiswonger is accused of circumventing the FTC’s asset freeze by transferring money to McAllister from accounts over which Shannon Neiswonger had control. Separately, McAllister also is accused of embezzling $1 million of the money the Neiswongers transferred to him for safekeeping. (McAllister ultimately was disbarred and sentenced to more than six years in prison.)

• 2012: Neiswonger pleads guilty to fraud charges in both the Reed and McAllister cases. His sentencing date has been repeatedly adjourned. His next hearing in the case is set for December.

• 2009-2015: Neiswonger is involved in two separate nationwide chains of erectile dysfunction clinics that operate under multiple names, including Yale Clinic, Physicians E.D. and Huntington Men’s. Neiswonger also is involved in Men’s Medical Clinics, which court documents indicate was launched in 2009. Earlier this month, Massachusetts Attorney General Maura Healey sued that clinic and its director, Kevin Hornsby, for allegedly engaging in “a panoply of unlawful, unfair and deceptive acts and practices.” A lawsuit filed by Neiswonger’s wife Shannon is still pending in a Florida court. In that suit, Shannon (nee Shaffer) claims that she is equal partners with Hornsby and that she “has always been the managing member of the business.” It also claims that Hornsby convinced Richard Neiswonger to forge his wife’s signature on an operating agreement in late 2013.