Eight employees of an Inland Empire physicians group that contracted with the state to perform services for people with workers’ compensation insurance claims are under indictment for allegedly defrauding the system in a $123 million scam that involved filling exorbitantly priced prescriptions that were not required to treat patients, prosecutors said Wednesday.
Rancho Cucamonga-based Blue Oak Medical Group came under investigation in March 2017. Evidence was presented to a grand jury in Riverside over a six-week period, after which indictments were handed down on Jan. 17.
The indictments, which were unsealed by Superior Court Judge O.G. Magno on Tuesday, name Kenneth Amodeo, 60, of Agoura Hills; Rosa Bernal, 46, of Covina; Shannon Devane, 41, of Downey; Janek Hunt, a 44-year-old Estonian national; Edgar Lozano, 52, of Porter Ranch; Matthew Rifat, 49, of El Cajon; Hector Sandoval, 54, of Sherman Oaks; and Munir Uwaydah, a 52-year-old Lebanese national.
The defendants are charged with multiple counts of conspiracy, healthcare fraud, money laundering and sentence-enhancing white-collar crime allegations.
Amodeo, Bernal and Lozano are each being held in lieu of $4.7 million bail at the Smith Correctional Facility in Banning; Devane and Rifat are each being held in lieu of $4.7 million at the Robert Presley Jail in Riverside; and Hunt is being held in lieu of $4.7 million at the Byrd Detention Center in Murrieta.
Arrest warrants are pending against Sandoval and Uwaydah, neither of whom are in custody.
Investigators from the Orange, Riverside and San Bernardino County district attorney’s offices, along with the California Pharmacy Board, compiled evidence against the eight, ultimately deciding to anchor the prosecution in Riverside County, where a number of workers’ comp claimants handled by Blue Oak Medical Group resided, according to D.A.’s office spokesman John Hall.
According to an agency statement, the defendants allegedly operated several “sham clinics” that processed thousands of patients, most of whom were prescribed “the same high-priced cocktail of unnecessary medications, regardless of their condition.”
Prosecutors allege that pharmacies managed by several of the conspirators produced the medications, for which the state was billed — even though the prescriptions were seldom, if ever, dispensed to the patients.
According to the prosecution, the defendants laundered their ill-gotten gains through various shell companies, disbursing funds to their cohorts in California, the Middle East and Europe.
Amodeo was the pharmacist allegedly directing the fraudulent operation, along with Uwaydah, a physician whose license is now inactive in California, and Rifat, an attorney, according to prosecutors.
Uwaydah is facing similar charges in Los Angeles County for a 2015 fraud case, prosecutors said.
Amodeo, Bernal and Lozano are slated to be arraigned on Feb. 6 at the Riverside Hall of Justice. Devane, Hunt and Rifat have status conferences set for Feb. 26.