October 19, 2010: Pharmacy Owner Charged with $12 Million Dollar Health Care Fraud
Food and Drug Administration
Office of Criminal Investigations
U.S. Department of Justice Press Release
For Immediate Release
October 19, 2010
U.S. Attorney's Office
Middle District of Pennsylvania
Peter J. Smith
The United States Attorney's Office for the Middle District of Pennsylvania announced today that the former owner of a closed pharmacy located in Sciota, Monroe County, Pennsylvania, has been charged with health care fraud, false statements relating to a health care matter, and misbranding of pharmaceuticals.
According to United States Attorney Peter J. Smith, the three-count Indictment alleges that Benny Salerno, age 40, of Stroudsburg, Pa, was the owner of a closed pharmacy, a pharmacy that supplies prescription medication to health care institutions. The Indictment further alleges that Salerno directed employees to retrieve unused portions of medications from the health care institutions and return the unused medications to stock for future use, regardless of lot number or expiration. Such conduct is in direct violation of the Pennsylvania Pharmacy Act and the Federal Food and Drug Administration regulations, which prohibit the return and reuse of medications once they have left the pharmacy. Such items are considered to be misbranded pharmaceutical products.
Salerno then sought reimbursement from government health care insurance providers for dispensing the items.
The Indictment alleges that the criminal conduct occurred over a period spanning approximately five years from 2001 until February 2006. The Indictment also seeks forfeiture of approximately $12 million dollars of illicit proceeds obtained by Salerno as a result of the alleged fraud scheme.
"While OIG works to shield Medicare and Medicaid from fraudulent billing, we also have a role in protecting the safety and health of some of America's most vulnerable citizens," said Nick DiGiulio Special Agent in Charge for the Philadelphia Region of the Office of Inspector General of the Department of Health of Human Services. "Violating federal and state law, as is charged in this indictment, is bound to result in investigation and prosecution by OIG and its law enforcement partners."
"Health care fraud takes money directly from the pockets of every patient and every taxpayer in Pennsylvania, driving up costs and diverting state and federal funds that are supposed to help senior citizens and low-income families," Pennsylvania Attorney General Tom Corbett said. "Mr. Salerno allegedly misused his position as a pharmacist to make millions, while leaving patients, insurance companies and taxpayers to foot the bill, and we are committed to working cooperatively in order to use every available resource to attack this type of criminal conduct."
U.S. Attorney Smith noted that the prosecution of health care fraud cases and the recovery of assets obtained through such fraud schemes are among the highest priorities of the United States Department of Justice.
If convicted, Salerno faces a term of imprisonment of up to 28 years and fines of up to $750,000.
This investigation was conducted by the Office of Inspector General for Health and Human Services, the Food and Drug Administration and the Pennsylvania Office of Attorney General and is being prosecuted by Assistant United States Attorney Amy C. Phillips.
An Indictment or Information is not evidence of guilt but simply a description of the charge made by the Grand Jury and/or United States Attorney against a defendant. A charged Defendant is presumed innocent until a jury returns a unanimous finding that the United States has proven the defendant's guilt beyond a reasonable doubt or until the defendant has pled guilty to the charges