U.S. Justice Department sentences third member in $2 billion telemedicine fraud case

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U.S. telemedicine fraud sentencing

Highlights

Anthony Santamaria received a 10-year prison sentence and was ordered to forfeit $3.2 million for his role in a $2 billion telemedicine fraud case.
Between 2017 and 2022, the group submitted over $1.97 billion in fraudulent prescriptions, resulting in private insurers paying out more than $758 million.
The operation used call centers in Utah and Russia, acquired U.S. pharmacies, and employed Moscow-based billing teams to process false reimbursement claims and launder funds overseas.

Sentencing details and scope of the scheme

As reported by the U.S. Department of Justice, Anthony Santamaria was sentenced earlier today in federal court in Brooklyn to 10 years in prison for his role in an international healthcare fraud conspiracy valued at about $2 billion. U.S. District Judge William F. Kuntz II also ordered Santamaria to forfeit $3.2 million, while co-defendant Hafizullah Ebady was ordered to forfeit more than $1.8 million, and restitution for all three defendants is due to be set later.

Santamaria is the third member of the organization sentenced this month. Hershel Tsikman received 120 months in prison earlier this month, Ebady was sentenced to 97 months, and a fourth defendant, Dela Saidazim, was sentenced to time served in December 2022.

Three more co-defendants, David Bishoff, Brycen Millett and Joshua Alegria, are still awaiting sentencing. An eighth co-defendant, Brian Sutton, identified by prosecutors as the leader of the organization and a U.S. citizen believed to be abroad, remains at large.

How the fraud operation affected insurers and pharmacies

According to court filings and proceedings, the defendants ran the scheme between 2017 and 2022 by using call centers first in Utah and later in Russia to contact beneficiaries covered by private insurers and offer medications at no cost, often without medical exams. Prosecutors said fraudulent prescriptions were generated whether or not patients agreed to receive the medications, and in most cases there were no real telemedicine visits despite the use of doctors' names and National Provider Identifier numbers.

The group also acquired pharmacies with existing insurer relationships across the United States and used Moscow-based billing teams to submit electronic reimbursement claims remotely. Third-party billing records cited by prosecutors show the defendants submitted more than $1.97 billion in fraudulent prescriptions, leading private insurers to pay more than $758 million.

Authorities said the network used aliases, shell companies, straw owners and encrypted communications to conceal its role and move money overseas. The pharmacies involved included locations in Brooklyn, Staten Island, Manhattan, Long Island, New Jersey, Pennsylvania, Texas, Michigan and Alabama.

In our earlier coverage of the Justice Department’s healthcare antitrust enforcement priorities, we explained how officials are directing resources toward conduct that can push up household costs in areas like insurance and prescription drugs. The piece highlighted the DOJ’s view that stronger competition can improve consumer choice and affordability, while also noting the practical challenges of policing complex healthcare markets.

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