The United States Attorney’s Office for the District of Colorado has announced the indictment of seven individuals in connection with a scheme to defraud Medicare and Colorado Medicaid through fraudulent genetic testing claims. The defendants, including individuals from Florida, California, Arizona, Maine, New Hampshire, and New York, allegedly conspired to submit over $40 million in false claims for medically unnecessary genetic testing.

According to the indictment, the defendants, who were involved with Tesis Labs, LLC, and other entities, are accused of paying kickbacks and bribes to marketing companies in exchange for patient referrals, many of whom were elderly Medicare beneficiaries. These referrals led to false claims submitted to Medicare and Medicaid for unnecessary tests.

Among those charged in the Medicare fraud case are Ronald King, 51, of Maine; Victor Roiter, 55, of Florida; Tina Wellman, 51, of New York; Adam Shorr, 55, of Florida; Robert O’Sullivan, 55, of California; Bradley Edson, 66, of Arizona; and John Gautereaux, 59, of California.

The indictment outlines a conspiracy to offer and pay illegal bribes for patient referrals and doctors’ signatures on genetic testing orders. In addition to health care fraud, three of the defendants—King, Roiter, and Wellman—face charges for conspiring to launder proceeds from the fraudulent activity.

The indictment against Ronald King, Victor Roiter, and their co-defendants involves multiple federal criminal statutes, particularly related to healthcare fraud, money laundering, and illegal kickbacks. These statutes are central to prosecuting complex fraud schemes that target government programs like Medicare and Medicaid.

1. Health Care Fraud (18 U.S.C. § 1347): This statute makes it a federal crime to knowingly execute or attempt to execute a scheme to defraud any health care benefit program, including Medicare and Medicaid. In this case, the defendants are accused of submitting false claims for genetic testing that was medically unnecessary, a violation of this statute. Convictions under 18 U.S.C. § 1347 can result in up to 10 years in prison, with enhanced penalties if serious bodily injury or death occurs as a result of the fraud.
2. Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)): The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving anything of value to induce or reward referrals for services reimbursed by federal health care programs. The indictment alleges that the defendants paid kickbacks to marketers in exchange for referrals of patients to undergo unnecessary genetic testing. Violating this statute carries penalties of up to 5 years in prison per offense, as well as fines up to $25,000.
3. Conspiracy to Commit Health Care Fraud (18 U.S.C. § 371): This statute addresses conspiracies to defraud the U.S. government or commit any federal offense. The defendants are accused of conspiring to defraud Medicare and Medicaid by collectively submitting fraudulent claims. Under this statute, conspirators can face up to 5 years in prison for their involvement, regardless of the success of the fraud.
4. Money Laundering (18 U.S.C. § 1956): The indictment also charges several defendants with money laundering, which involves conducting financial transactions with the proceeds of criminal activity, in this case, the proceeds from the fraudulent claims. Money laundering under 18 U.S.C. § 1956 carries up to 20 years in prison, along with substantial fines and forfeiture of assets gained through illegal activity.
5. False Claims Act (31 U.S.C. § 3729): While not a criminal statute, the False Claims Act is often invoked in cases like this. It imposes liability on individuals and entities who knowingly submit false claims to the government. Violators may face civil penalties of up to three times the amount of damages the government sustains, in addition to per-claim penalties.

The defendants have made their initial appearances in Denver, Colorado, before Magistrate Judge Susan Prose. They face serious charges, but under U.S. law, they are presumed innocent until proven guilty.

The case is being investigated by the Department of Health and Human Services – Office of the Inspector General, the Federal Bureau of Investigation (FBI) Denver Field Division, and the Internal Revenue Service – Criminal Investigation.