With thousands of employees and many hundreds of vendors, it wasn’t difficult to see how the scam went on for close to 20 years before the bars slammed shut behind her.
No, it wasn’t a healthcare business, more on that in a moment, but it was a scam older than double entry accounting. A long time and well trusted accounts payable supervisor of the manufacturing business had set up a slew of phony vendors, each of which generated a regular stream of phony invoices, each of which was paid by the business, the dollars ending up in the employee’s bank-account.
Although that was more than 40 years ago, I have no reason to believe that similar scams haven’t been run every day since then.
Take Josh Maywalt for example.
Maywalt, of Tampa, Florida, worked as a medical biller at a billing services provider. Among his duties, he was assigned to a particular client physician’s account. As a result, he had access to the practice’s financial, provider, and patient information. For anyone who didn’t skip immediately to this paragraph, you can see where this is going.
Maywalt wrongfully accessed patient information and utilized the physician’s name and identification number to submit false and fraudulent claims to a Florida Medicaid HMO for services purportedly rendered by the physician but not actually performed. In order to obtain the resulting cash, Maywalt altered the “pay to” information on the claims so that payments were directed to bank accounts that he controlled.
To add a little extra insult to injury, and probably to hide the snail trail of fraud, Maywalt didn’t file federal income tax returns for 2017 and 2018. He did file a return for 2019, but substantially understated his income by reporting only his employment wages, not the substantial amount of money he was depositing into his bank accounts as a result of his fraudulent activities.
Maywalt’s short criminal career ended abruptly when he pleaded guilty on December 1, 2021, to healthcare fraud, aggravated identity theft, filing a false income tax return, and failing to file income tax returns.
On June 2, 2022, he was sentenced to five years and five months in federal prison and was also ordered to forfeit $2,257,029.86 and real property located at 5346 Northdale Boulevard in Tampa, which are traceable to proceeds of his crimes.
For physicians as well as for those running facilities, and in fact for the owner of any business of any sort, the moral of the story is to exercise tremendous diligence and implement operational checks and balances in connection with the presentation, and in some cases, payment, of invoices.
But there is a special twist here, especially for medical practitioners: In many cases, fraudsters construct their fake claim scams such that proceeds are directed into the practice’s account and then back out to the criminal via various means. Once those payments flow through your account, it raises the very serious question as to whether you participated in the scam. The sick thrill of being able to take your medical license away provides ample fuel for an unscrupulous prosecutor to name you as a codefendant; in fact, he or she might even allow the actual criminal to flip and testify against you. To discuss what you need to do to protect yourself, contact me.