An operator of Southland sleep study facilities was sentenced to more than two years in prison for scheming with two other men to bilk union health plans out of millions of dollars, federal officials announced Monday.
Nick Nikbakht — who ran sleep study centers in Sherman Oaks and San Pedro — pleaded guilty in federal court in downtown Los Angeles to two counts of mail fraud and one count of conspiracy to commit money laundering. He was sentenced Dec. 2 to 27 months in federal prison, and was ordered to pay more than $2.9 million in restitution, according to the U.S. Department of Labor.
Two other men were sentenced last year in the case. Shawn Chait was ordered to serve one year in prison and repay more than $3 million. Oganes Doganyan was sentenced to 33 months in prison and ordered to pay roughly $1.4 million in restitution.
Federal officials said the three men schemed to rip off multiple health plans, including the International Longshore and Warehouse Union-Pacific Maritime Association Welfare Plan and the Federal Express Corporation Group Health Plan, by recruiting members to undergo unnecessary sleep and nerve-conduction velocity tests.
At least $16 million in fraudulent claims were billed to the health plans, which paid out at least $3 million.
Nikbakht and Doganyan kicked back some of the proceeds to plan participants, sometimes paying them $300 to $500 per study. Some of the cash was transferred to companies controlled by Doganyan to disguise the funds as legitimate business transactions, according to the U.S. Department of Labor.
“The U.S. Department of Labor is committed to ensuring that employee health benefits are not abused,” said Employee Benefits Security Administration Regional Director Crisanta Johnson. “The Employee Benefits Security Administration will continue to work diligently with our investigative partners to bring justice and protect the health benefits that hard-working families count on.”
The case was jointly investigated by the EBSA, the department’s Office of Inspector General, the FBI and the IRS, and was prosecuted by the U.S. Attorney’s Office.
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