A federal jury in Houston convicted a Spring pharmacist Friday of running a scheme that funneled more than $2 million in illegal kickbacks to a clinic owner in exchange for patient referrals, part of a fraud that ultimately drained over $20 million from a federal workers' compensation program. Tronown Thomas, 54, owner and operator of Rayford ACP Pharmacy, was found guilty following a five-day trial on charges of conspiracy to pay health care kickbacks.
According to the US Attorney SDTX, Thomas paid the kickbacks between November 2015 and September 2017 to a Houston clinic owner in exchange for patient referrals, which allowed Rayford ACP Pharmacy to collect more than $20 million in reimbursements for compounded medications from the Department of Labor's Office of Workers' Compensation Programs, per the U.S. Department of Justice. That program is designed to cover medical treatment costs for injured federal employees, not to enrich pharmacy owners who game its reimbursement system.
During the trial, defense attorneys argued that the payments Thomas made were for legitimate marketing services rather than illegal referral kickbacks, but the jury rejected that claim, the Justice Department noted. U.S. District Judge Alfred H. Bennett has scheduled sentencing for November 12, 2026, where Thomas faces up to five years in federal prison and a maximum fine of $250,000. He has been permitted to remain free on bond in the meantime.
A Case Years in the Making
Thomas's conviction is the culmination of a prosecution that began back in April 2022, when he was originally indicted alongside five co-defendants. Those included Houston physician Dr. Charles Willis and clinic owner Henry Gonzales, all accused of conspiring to bill federal employee workers' compensation for medically unnecessary compound drugs, the Justice Department's Southern District of Texas office said in its original announcement.
The conviction was announced under the Department of Justice's National Fraud Enforcement Division, a division established in April to centralize and expand prosecutions of fraud targeting federal benefit programs, according to the Justice Department. The new division reflects a Department-wide mandate to coordinate anti-fraud efforts across agencies, rather than leaving individual prosecutors' offices to chase these cases piecemeal.
Why Compounding Pharmacies Became a Target
The Department of Labor's Federal Employees' Compensation Act program processes nearly $3 billion annually in benefits, and it has historically faced significant fraud exposure from custom compounding medications billed at abnormally high reimbursement rates, per the U.S. Department of Labor Office of Inspector General. Because compounded drugs historically lacked standardized pricing benchmarks, they created an opening for corrupt clinic operators and pharmacists to collaborate on inflated billing schemes.
Thomas's case is far from an isolated one in the Houston area. In June 2020, Houston pharmacist George Philip Tompkins, known as the “Compound King” and former owner of Piney Point Pharmacy, was sentenced to 10 years in prison and ordered to pay $12.3 million in restitution for a $21.8 million DOL-OWCP compounding kickback scheme, according to the National Insurance Crime Bureau. Tompkins reportedly used shell companies to launder the illegal kickback funds.
More recently, in May 2025, former Pharr pharmacist John Aguedo Rodriguez was sentenced in the Southern District of Texas to five years in federal prison for operating a similar $110 million compounding pharmacy kickback scheme that paid $24 million to medical marketers, the U.S. Department of Health and Human Services Office of Inspector General reported. And in September 2023, federal prosecutors in Houston unsealed a 13-count indictment against twin sisters — pharmacist Shalondria Simpson and physician Lashondria Simpson-Camp — in an alleged $170 million compounding prescription kickback scheme targeting federal workers' compensation.
What the Law Says About Kickbacks
Under federal law, specifically 42 U.S.C. § 1320a-7b, paying or receiving kickbacks to generate referrals for federal healthcare-funded services is a felony punishable by up to 10 years in prison, $100,000 in criminal fines, and automatic civil liability under the False Claims Act, according to the Legal Information Institute. The statute exists specifically to prevent financial incentives from corrupting medical decision-making, a concern that shows up repeatedly across these Houston-area prosecutions.
Thomas's case adds to a growing list of compounding pharmacy fraud prosecutions Hoodline has tracked in Texas, including a massive Houston fraud sweep and a case involving a $4.4 million Medoc prescription kickback scheme. With sentencing now set for November, Thomas becomes the latest pharmacist in the region to face the consequences of exploiting a federal program meant to help injured workers.
