TRENTON
- Attorney General Peter C. Harvey announced
that husband and wife chiropractors, along
with three individuals acting as "runners,"
have been charged by the Division of Criminal
Justice - Office of Insurance Fraud Prosecutor
with masterminding an Essex County insurance
fraud scheme which billed dozens of insurance
companies more than $1 million for chiropractic
and patient transportation services that
were never provided.
"Fraudulent
schemes such as over-billing and phantom-billing
for medical services and supplies never
provided and the use of ‘runners'
to illegally pad accounts receivable in
order to boost insurance claims is nothing
less than corruption fueled by greed,"
said Attorney General Harvey. "This
indictment clearly demonstrates the level
to which a corrupt medical care provider
will go to rip-off insurance companies
in their quest for illegal dollars. The
Division of Criminal Justice and the Office
of Insurance Fraud Prosecutor is taking
direct aim at such corrupt schemes and
will continue to aggressively investigate,
arrest and prosecute anyone involved in
insurance fraud."
According to Vaughn L. McKoy, Director,
Division of Criminal Justice and Insurance
Fraud Prosecutor Greta Gooden Brown, a
State Grand Jury indictment charges Litsa
(Lisa) Tsilionis, 41, and her former husband,
George Tsilionis, 42, 24 South Woodside
Ave., Bergenfield, Bergen County, with
second degree conspiracy, Health Care
Claims Fraud, theft by deception, financial
facilitation of criminal activity (money
laundering), and misconduct by a corporate
official.
The State Grand Jury indictment also charged
Carl Love, Jr., 27, Northfield Avenue,
West Orange; Rajauhn Sharrieff, 52, Birks
Place, Newark; and Rudolf Hora, age unknown,
of South Orange Avenue, Newark and/or
North 17th Street in East Orange. Love
and Sharrieff were charged with conspiracy,
Health Care Claims Fraud, theft by deception
and misconduct by a corporate official.
A separate indictment charged Love with
the unlawful possession of a .25 caliber
handgun recovered during a search of his
residence. Hora was charged with conspiracy.
A second degree crime carries a maximum
penalty of up to ten years in state prison
and a fine of up to $150,000. A third
degree crime is punishable by up to five
years in state prison and a fine of up
to $15,000. Additionally, the defendants
face possible civil insurance fraud fines
pursuant to the Insurance Fraud Prevention
Act.
The Division of Criminal Justice - Office
of Insurance Fraud Prosecutor's investigation
determined that Lisa and George Tsilionis
were licensed chiropractors and were the
owners, operators and corporate officers
of Allied Trauma and Health Care Center,
Inc. and Accutest Mobile Diagnostics Group
-- both corporations operated out of offices
located at 55 Washington Street, East
Orange, Essex County. Love and Sharrieff
operated Essex Shuttle, Inc., a transportation
company which also maintained its business
address at Allied Trauma's offices in
East Orange. Essex Shuttle purportedly
transported patients to and from medical
appointments.
According to Insurance Fraud Prosecutor
Gooden Brown, the indictment alleges that
from July, 1996 through March, 1999, the
Tsilionis', in their capacities as licensed
chiropractors and the owners/operators
of Allied Trauma, fraudulently billed
30 different insurance carriers more than
$1.2 million in Personal Injury Protection
(PIP) claims. The claims sought payment
for chiropractic services and electrodiagnostic
tests known as Somatosensory Evoked Potentials
(SSEP) - chiropractic procedures that
are frequently used to diagnose injuries
in connection with automobile insurance
claims - that the were never provided
to patients. The insurance carriers paid
approximately $435,000 on the claims submitted
by the Tsilionis' and Allied Trauma.
As part of the alleged corruption scheme,
the indictment charges that the Tsilionis'
falsified chiropractic treatment records
to establish the clinical support necessary
to justify SSEP testing; falsified SSEP
records; and directed staff to submit
bills for chiropractic treatments and
other therapeutic treatments that were
never provided to patients. An audit of
Allied's books and records determined
that the number of treatments billed to
insurance carriers far exceeded the number
of treatments that could realistically
be performed by Allied staff. Additionally,
it is alleged that in cases where patients
were actually treated, records were altered
to bill for additional services that were
not provided.
The indictment also charged that from
June through December, 1998, Love and
Sharrieff created Essex Shuttle to make
it appear that the Tsilionis' were paying
Essex Shuttle for transportation services,
when, in fact, they allegedly were paying
Love, Sharrieff and Hora to act as "runners"
for Allied Trauma. (A "runner"
is a person paid by a licensed medical
service provider to procure patients for
the medical practice so that insurance
claims can be submitted for providing
treatment.) It is alleged that Love and
Hora were paid to produce a steady stream
of automobile accident insurance claimants
for Allied Trauma so that inflated and
fraudulent PIP claims could be submitted
to insurance carriers. Additionally, it
is alleged that Love and Sharrieff, through
Essex Shuttle, fraudulently billed various
insurance carriers more than $5,400 for
transportation services that were never
provided.
The indictments were handed up to Mercer
County Superior Court Judge Maria Marinari
Sypek on Nov. 17. The case has been assigned
to the Essex County Superior Court for
trial. The defendants will be ordered
to appear in Court for arraignment and
bail.
The investigation was conducted by the
Division of Criminal Justice - Office
of Insurance Fraud Prosecutor. State investigator
Kristen Marcus, civil investigator Martin
Arisin, special civil investigator Jeremy
Rabe and Deputy Attorney General Steven
B. Farman coordinated the investigation.
DAG Farman represented the Division of
Criminal Justice - Office of Insurance
Fraud Prosecutor before the State Grand
Jury. Assisting the Office of Insurance
Fraud Prosecutor in the investigation
were investigators and security officers
from the Allstate Insurance Company and
the Prudential Insurance Company.
Insurance Fraud Prosecutor Gooden Brown
noted that the Office of Insurance Fraud
Prosecutor realized a 143 percent increase
in indictments; a 91 percent increase
in defendants charged; a 79 percent increase
in convictions (trial convictions and
guilty pleas); and a 60 percent increase
in civil sanctions in 2002. The Office
of Insurance Fraud Prosecutor charged
225 defendants in 2002, versus 118 defendants
in 2001. Additionally, the Office of Insurance
Fraud Prosecutor imposed sanctions in
3,723 civil fraud cases in 2002, compared
to 2,063 civil sanctions obtained in 2001.
The Office of Insurance Fraud Prosecutor
collected $20.6 million in penalties in
2002, up from $15.8 million in 2001.
Noting that some important cases have
begun with anonymous tips from the public,
Insurance Fraud Prosecutor Gooden Brown
encouraged anyone with information about
insurance fraud to contact the Division
of Criminal Justice - Office of Insurance
Fraud Prosecutor's toll-free hotline at
1-877-55-FRAUD, or to visit the
insurance fraud Web site at www.NJInsurancefraud.org
.
Housed in the Department of Law and Public
Safety's Division of Criminal Justice
and reporting to the Attorney General,
the Office of the Insurance Fraud Prosecutor
was established by the Automobile Insurance
Cost Reduction Act of 1998 (AICRA). The
Office is the centralized state agency
that investigates and prosecutes civil
and criminal insurance fraud, as well
as Medicaid fraud. Criminal convictions
for insurance fraud can result in fines
and imprisonment. Civil penalties can
include substantial fines and referral
for revocation or suspension of professional
licenses.
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