A scheme to defraud the U.S. Department of Veterans Affairs has led to a five-year prison sentence for the owner of a suburban Chicago medical supply company. Darren A. Smith, who operated his business out of Bolingbrook, Illinois, was convicted for his role in paying kickbacks to procure orders of medical equipment from the VA.
According to a news release from the U.S. Attorney's Office for the Northern District of Illinois, between 2017 and 2020, Smith colluded with a procurement clerk within the Veterans Health Administration Prosthetics Service to place unnecessary and overpriced equipment rentals. These orders went against the direct instructions from VA physicians, who had recommended outright purchases.
Federal authorities stated that Smith's company received over $2.7 million from a the VA, and was overpaid by more than $1.3 million as part of this fraudulent scheme. In return, Andrew Lee, the VA procurement clerk involved, received at least $220,000 in kickbacks from Smith. Smith's illegal activities were uncovered following a conviction on eight counts of wire fraud earlier this year.
U.S. District Judge Edmond E. Chang imposed a $10,000 fine along with the prison term and ordered Smith to pay restitution exceeding $1.3 million. "Instead of paying for essential equipment and supplies for veterans, the defendants used the VA’s money to line their own pockets," Acting U.S. Attorney Morris Pasqual stated. Smith's accomplice, Andrew Lee from Chicago, has pled guilty to a charge of wire fraud and is currently awaiting his sentence.
The prosecution of the case was handled by Assistant U.S. Attorney Heidi Manschreck and Special Assistant U.S. Attorney Benjamin Christenson. The Department of Veterans Affairs Office of Inspector General, particularly Special Agent-in-Charge Gregory Billingsley, played a crucial role in the investigation, asserting a clear message: corruption within the VA will not be tolerated. "These fraudulent activities erode public trust and divert taxpayer money intended for our nation's deserving veterans," said SAC Billingsley in his pursuit of justice against those who exploit the system.
