A Houston man has been convicted of healthcare fraud and faces prison sentences that could last for decades and a high fine in the millions of dollars. This case underscores the critical importance of effective criminal defense strategies in navigating complex federal charges.
According to the Department of Homeland Security, Mohamad Mokbel, 59, of Houston, was recently convicted in the U.S. District Court for the Southern District of Texas (located in Houston) of five counts of healthcare fraud, six counts of money laundering, conspiracy to commit mail fraud, conspiracy to violate the anti-kickback statute and bribery concerning programs receiving federal funds.
If you or someone you care about is facing similar charges, having an experienced Houston criminal defense attorney by your side is vital to safeguard your rights.
Mokbel had been released on bond after the charges were initially made. His trial in October then lasted for 10 days.
The jury deliberated for under five hours before handing down the convictions. After that, he was taken into custody pending sentencing.
U.S. District Judge Lee H. Rosenthal accepted the jury’s verdict and set sentencing for Jan. 7, 2025.
Potential prison time and massive fines
Mokbel then will face possible punishments of up to 20 years in prison for conspiracy to commit mail fraud and healthcare fraud, 10 years in prison for each of the five counts of healthcare fraud, 10 years in prison for each of the six counts of money laundering, 10 years in prison for bribery concerning programs receiving federal funds, five years in prison for conspiracy to violate the anti-kickback statute and five years in prison for conspiracy to commit bribery.
In addition, he could be ordered to pay up to $4 million in fines and pay possible restitution in excess of the $160 million Medicare fraud scheme for which he was convicted.
Keep in mind that federal sentencing guidelines for white-collar fraud have been criticized for being unfair. However, the U.S. Supreme Court has held that such guidelines are advisory and not compulsory. That means judges in such cases have the discretion to hand down lesser punishments than the guidelines state.
A multi-agency investigation found fraud
Mokbel was arrested after a multi-agency investigation was conducted by Homeland Security Investigations (HSI) Houston, the FBI, IRS Criminal Investigation, the U.S. Department of Health and Human Services, the U.S. Food and Drug Administration and the Texas Attorney General’s Medicaid Fraud Control Unit.
“Mohamed Mokbel defrauded the nation’s Medicare system that our senior citizens and the chronically infirmed rely on for life-sustaining medical care to fund his lavish lifestyle at taxpayer expense,” HSI Houston acting Special Agent in Charge Robert Kurtz said after the convictions.
“Working alongside our federal and state partners, we were able to uncover his scheme.”
Kurtz said the investigators aimed to “hold everyone involved in the conspiracy accountable and prevent them from further exploiting this program that our elderly and disabled populations desperately need to survive.”
Assistant U.S. Attorneys Adam Laurence Goldman and Kathryn Leigh Olson are the prosecutors on the case. The convictions on all 15 counts were announced by U.S. Attorney Alamdar S. Hamdani.
Medical information was reportedly purchased illegally
According to the U.S. Food and Drug Administration, Mokbel was founder and CEO of 4M Pharmaceuticals, which operated 14 pharmacies through straw owners from 2014 to 2021.
The FDA said he illegally purchased the medical information of thousands of Medicare beneficiaries, including people’s identification numbers and physician information, for about $16 to $40 each.
Mokbel and his co-conspirators then used the information to target elderly diabetic patients who were dependent on diabetic testing supplies to manage their blood sugar levels, the FDA said.
To maximize reimbursements and without regard for medical necessity, the FDA said Mokbel directed 4M employees to use Medicare beneficiaries’ patient data to run insurance claims to determine if Medicare or other insurance plans would cover and reimburse at a high rate for the topical creams, omega-3 pills and other medications that Mokbel intended to sell through his 4M pharmacies.
At his direction, 4M employees reportedly then faxed to the patients’ doctors pre-filled prescription requests appearing to be for diabetic testing supplies, with topical creams, added at the bottom. They also included false representations that the patient was requesting a 4M Pharmacy to fill their medications.
But in reality, the FDA said, Mokbel not only had purchased the patient’s personal information, but the patient had not selected a 4M Pharmacy and often was unaware that such a request was being made on their behalf.
The FDA said numerous physicians apparently took the representations in the fax at face value and did sign and send back the prefilled prescription requests to 4M, after which Mokbel’s call centers in Houston and later in Egypt contacted the patients and made false and misleading statements about the topical cream and their doctor’s order.
Mokbel’s pharmacies then reportedly shipped out numerous topical creams, often on auto-refill, and excessively billed Medicare, Medicaid and private insurance plans. The FDA said Mokbel made more than $200 million as a result of the scheme.
Authorities also said that from 2015 through 2020, he corruptly made a series of bribe payments ranging from $2,000 to $5,000 and totaling more than $188,000 to an employee of pharmacy benefits manager OptumRx in exchange for favorable treatment for 4M pharmacies.
The pharmacies then reportedly were able to enter into retail network agreements with OptumRx, participate in the Medicare Part D program and submit claims for prescriptions for Medicare beneficiaries. Mokbel also reportedly received information and advice about responding to audits and preventing and delaying OptumRx’s termination of many 4M pharmacies.
Get an experienced Houston criminal defense attorney
Mohamad Mokbel’s case highlights just how serious charges like healthcare fraud, Medicare fraud, mail fraud, bribery, and the illegal purchase of medical information can be. These are complex allegations that require a thoughtful and effective defense.
Although fraud, like theft, bribery, embezzlement or money-laundering, is a non-violent white-collar crime, the penalties and punishments for such crimes can be extremely harsh, both on the federal level and the state level. That is why it’s imperative for those who are accused of a white-collar crime to find a knowledgeable defense lawyer to fight for their legal rights.
At the Neal Davis Law Firm PLLC, we know how overwhelming facing such charges can be. Our team of Houston defense attorneys is dedicated to helping you through every step of the legal process.
We’re here to protect your rights and work hard to build a strong defense for you.
Our attorneys have developed many strategies to attack fraud charges. One strategy is to focus on pretrial negotiations with prosecutors, which could make a trial unnecessary.
Pretrial negotiations can be a matter of working to arrange a plea deal before trial. Such a deal can involve arranging for a lesser charge to be made in exchange for the defendant making a guilty plea to that charge. Pretrial negotiations even can lead to a charge being dismissed entirely if the evidence is not strong.
Why some criminal charges don’t go to trial
It’s important to understand that not all criminal charges proceed to trial. In fact, many charges are dismissed before reaching the courtroom through negotiations between prosecutors and defense attorneys. However, only the prosecutor has the authority to drop these charges.
This highlights the critical role that experienced criminal defense attorney play in advocating for their clients and seeking the best possible outcomes.
If you live in Houston, The Woodlands, Conroe, Sugar Land or elsewhere in the Houston area, contact the legal team at the award-winning Neal Davis Law Firm today to schedule a confidential consultation for your fraud case.
Our law firm has been particularly honored and cited for handling white-collar crime cases, and our defense lawyers stand ready to fight for Americans who, perhaps unfairly, face such charges.
