Kaival Patel of West New York in New Jersey was convicted on December 7 of one count of conspiracy to commit wire fraud and health care fraud, four counts of health care fraud.

New York: A 54-year-old Indian-American was found guilty on 11 counts of defrauding public health insurance plans out of more than USD 4 million and transacting in the criminal proceeds, authorities have said. Kaival Patel of West New York in New Jersey was convicted on December 7 of one count of conspiracy to commit wire fraud and health care fraud, four counts of health care fraud. He was also convicted of one count of conspiracy to commit money laundering by transacting in criminal proceeds, and five counts of money laundering by transacting in criminal proceeds, the US Justice Department said in a statement last week.

Kaival Patel created and operated a company called ABC Healthy Living LLC to market compound prescription medications. Patel and his conspirators learned that certain state and local government employees had insurance that would reimburse up to thousands of dollars for a one-month supply of certain compound medications such as vitamins, scar creams, pain creams, libido creams, and acid reflux medications.

Kaival and a conspirator approached one of his family member, a medical doctor who owns and operates a clinic in Newark, New Jersey, and convinced him to authorize prescriptions for the compound medications for patients who had no medical need for the prescriptions. Patel received commissions for the compound medication prescriptions.

Patel and his conspirators paid a group of corrections officers to go to Patel’s family member’s medical practice for the purpose of receiving fraudulent prescriptions. Patel conspired with a compounding pharmacist to add unnecessary ingredients to the compound medications to further increase their cost and augment his illicit profits. Patel engaged in a series of financial transactions to receive proceeds from the health care fraud and wire fraud conspiracy.

To date, approximately 47 people have been convicted or pleaded guilty in the overarching conspiracy.

Patel faces a maximum penalty of 20 years in prison and a fine of USD 250,000 fine, or twice the gross pecuniary loss from the offense, whichever is greatest. On each of the remaining 10 counts, he faces a maximum penalty of 10 years in prison and a USD 250,000 fine, or twice the gross pecuniary gain or loss from the offense, whichever is greatest. Sentencing is scheduled for April 10, 2024.