In a landmark bust, the Santa Clara County Superior Court has doled out sentences to the final members of a 15-person crew behind a massive $40 million medical insurance scam in California. Sobriquets aside, “The Care Group” of mostly Los Angeles denizens, leveraged human suffering into their ill-gotten gains — peddling unnecessary and overpriced prescriptions and medical equipment to unsuspecting California residents.
The convictions, ranging from felonies to misdemeanors, were handed down with some culprits looking at county jail time. District Attorney Jeff Rosen minced no words when describing the group's tactics, "This group used people’s pain and illnesses to criminally enrich themselves," according to a statement. Disguised behind shell corporations and figurehead owners, the defendants thought they were beyond the reach of the law, they found otherwise.
Moving from 2015 to the crux 2020, these swindlers operated from their swanky Beverly Hills offices. At the core was Global Marketing, a telemarketing company, and California General DME, a durable medical device company, alongside a chain of pharmacies. They blasted untold thousands with unnecessary prescriptions for costly items like neck braces. They specially formulated pain creams, often billing insurers $4,000 for products costing just a fraction of that. The prescribing doctors involved were often just names on paper, never looking at the supposed "patients" they treated.
Telemarketers were instructed to add legitimacy to the scheme by inventing partnerships with non-existent entities like the “Physician’s Network” or “Doctor’s Network." Mirrored in notoriety, the scam extracted about $40 million from insurance companies throughout California, with Santa Clara County alone reeling from a $2.3 million hit. The court-ordered restitution totaled over $8.3 million, setting a record for the Santa Clara County's District Attorney’s Office regarding a single restitution recovery in an insurance fraud case.
An impressive and exhaustive multi-year inquisition by the District Attorney’s Office Bureau of Investigation channeled through C.R.E.A.M. (Cash Rules Everything Around Me) nailed down the convolutions of this deceptive enterprise. The task force included the California Department of Insurance, the California State Board of Pharmacy, and several district attorneys' offices across the state, proving collaboration to be a cornerstone in routing such deep-seated deceit.
