Seabrook Rehab Center to Pay $19.75 Million for FCA Violations

Seabrook Rehab Center to Pay $19.75 Million for FCA Violations

A New Jersey drug and alcohol rehabilitation center, Seabrook, will pay $19.75 million to resolve allegations that it violated the False Claims Act (FCA) by operating without the required license for the type of care being provided by the facility, failing to have sufficient appropriately licensed staff, and billing Medicaid and the Veterans Health Administration for services that were not provided. From January 2022 to December 2024, Seabrook allegedly provided “partial hospitalization” services to veterans without appropriate licensure and attempted to conceal the provision of the services from state inspectors by hiding the presence of residents at Seabrook by taking the residents on outings during inspections. The facility also allegedly billed for services provided by unsupervised interns and falsely claimed it provided specialized care to veterans. The United States also alleged that Seabrook maintained inaccurate records of employees’ credentials, documented and billed for services that were not actually provided, and failed to employ enough credentialed caregivers.

Former Seabrook employee and whistleblower Jennifer Coulter will receive approximately $3.5 million for her portion of the recovery. Seabrook cooperated with the investigation, including by implementing remedial measures and disciplining the responsible individuals.

The US Department of Justice’s (DOJ) press release can be found here.

The case is captioned, Coulter et al. v. Seabrook House Inc., 1:23-cv-00451, (DNJ).

New Jersey Man Sentenced for Fraudulent $900,000 PPP Loan Scheme

Joseph McKeon, a 54-year-old resident of Westfield, New Jersey, was sentenced to 24 months in prison for fraudulently acquiring a $900,000 Payroll Protection Program (PPP) loan. US Attorney Alina Habba announced that McKeon, who also goes by “Jay McKeon,” pleaded guilty to charges of wire fraud and money laundering. McKeon’s fraudulent activities spanned from February 2021 to February 2022, during which he submitted false PPP loan applications for his company, misrepresented employee counts and incomes, and submitted forged documents such as payroll information, bank statements, and tax returns to justify the PPP loan.

After receiving the PPP loan, McKeon used the funds for personal gain, including withdrawing large sums of cash and making significant bank transfers, including a $315,503.75 transfer to an Indiana title company. In addition to the prison term, Judge Julien Xavier Neals sentenced McKeon to two years of supervised release and ordered McKeon to pay $900,000 in restitution.

The DOJ’s press release can be found here.

North Carolina Man Agrees to $4.7 Million Judgment for Medicaid Fraud Scheme

Steven Osbey of Kernersville, North Carolina, agreed to a $4,711,159 consent judgment in favor of the United States and the State of North Carolina to resolve health care fraud allegations. The judgment represents a repayment for allegations that Reign & Inspirations, LLC, a clinic co-owned by Osbey and Aljihad Shabazz, fraudulently billed Medicaid for non-existent physician home visits. The scheme involved submitting claims for over 30,000 hours of in-home visits that never occurred, including instances where more than 100 visits were billed in a single day.

Shabazz previously pleaded guilty to health care fraud conspiracy and money laundering and received a 52-month prison sentence followed by two years of supervised release.

The DOJ’s press release can be found here.

California Man Involved in $17 Million Medicare Fraud Scheme

Petros Fichidzhyan, a 44-year-old resident of Granada Hills, California, was sentenced to 12 years in prison and three years of supervised release for his involvement in a scheme that defrauded Medicare of over $17 million. Fichidzhyan and accomplices billed Medicare for non-existent and medically unnecessary hospice services through sham hospice companies and his home health care company. They used personally identifying information of foreign nationals and deceased doctors to conceal their activities, open bank accounts, and submit fraudulent claims. Medicare paid nearly $16 million to these sham hospices, of which Fichidzhyan received $7 million and laundered over $5.3 million through various shell and third-party accounts. Additionally, Fichidzhyan obtained over $1 million through false claims paid to his home health care agency.

Fichidzhyan pleaded guilty to charges of health care fraud, aggravated identity theft, and money laundering in February. He was ordered to pay restitution of $17,129,060 and forfeit a home he purchased with fraudulent proceeds. The government also seized nearly $3 million from accounts linked to the scheme.

The DOJ’s press release can be found here.