Los Angeles, California - Two Glendale residents have been found guilty of laundering millions of dollars illegally generated by a health care fraud scheme that billed Medicare for equipment and tests that were not medically necessary and sometimes were never provided.
Edgar Pogosian, also known as “Edgar Hakobyan,” 32, was found guilty today of conspiring to commit money laundering and one count of money laundering.
Karen “Gary” Sarkissian, 44, was convicted Thursday of conspiring to commit money laundering, six counts of money laundering, and five counts of health care fraud.
Pogosian and Sarkissian were found guilty by a federal jury following a three-week trial before United States District Judge Philip S. Gutierrez. The jury returned verdicts against Sarkissian on Thursday afternoon and continued to deliberate on the charges against Pogosian until today.
Judge Gutierrez is scheduled to sentence Sarkissian on June 6, and Pogosian on June 27. At sentencing, Pogosian will face a statutory maximum sentence of 40 years in federal prison, and Sarkissian could be sentenced to as much as 190 years in prison.
“As we continue to target organizations that scheme to defraud the Medicare system, criminals develop more elaborate methods to avoid detection, as seen in the money laundering activities of these defendants,” said United States Attorney Eileen M. Decker. “This case shows, however, that federal investigators have the knowledge, skills and tenacity to investigate and prosecute complex fraud schemes, and my office will continue such prosecutions to protect critical government programs like Medicare.”
With today’s guilty verdicts, a total of five defendants have now been convicted in relation to a health care fraud scheme related to several medical clinics, durable medical equipment suppliers and independent diagnostic testing facilities. Sarkissian operated a clinic on Sunset Boulevard in Echo Park and worked there with a physician’s assistant, L’Tanya Smith, who pleaded guilty in this case on the eve of trial. Between July 2009 and March 2010, Smith prescribed or ordered medically unnecessary tests and services at the Sunset clinic, some of which were never provided to the patients. Those prescriptions and orders led to more than $1.2 million in fraudulent claims to Medicare.
“Smith also prescribed medically unnecessary [durable medical equipment] (mainly orthotics) and other medically unnecessary diagnostic tests that were referred to other Medicare providers, some of which were also depositors into the money laundering conspiracy…,” according to court documents. “These providers, in turn, submitted and caused to be submitted over $10 million in false and fraudulent claims to Medicare.”
Smith, 58, of Ladera Park, pleaded guilty to five counts of health care fraud and is scheduled to be sentenced by Judge Gutierrez on May 2, at which time she will face a statutory maximum sentence of 50 years in federal prison.
Sarkissian participated in a scheme that laundered the fraudulent proceeds generated through the Sunset Clinic through five bogus corporations set up by two other men who have also been convicted in this case. The two co-conspirators deposited millions of dollars in fraudulent proceeds into bank accounts for the companies and then wrote checks from these corporations to themselves and their relatives, including Pogosian, who was found guilty based on evidence that he received checks from the sham corporations that he either cashed or deposited in his own bank accounts.
“Some of the checks written to the five corporations falsely indicated that they were payments for services such as advertising, investment, consulting, management, equipment, or professional or technical services,” according to court documents. “The five corporations in fact had no connection to the medical industry, did not provide any legitimate business services to the Medicare providers that wrote the checks, and existed primarily to launder money.”
Pogosian’s uncle, Khachatour Hakobyan, 47, of Glendale, who prosecutors argued was the overall leader of the scheme, was sentenced last month to 57 months in prison and was ordered to pay $606,681 in restitution after he pleaded guilty to conspiring to launder health care fraud proceeds through the five sham corporations and underreporting his income from the conspiracy on his federal income tax returns.
Aram Aramyan, 60, of Glendale, was sentenced in November to 51 months in prison and was ordered to pay $353,669 in restitution.
“The defendants laundered over $1 million in fraudulently obtained Medicare funds through their sham businesses, often using it for their own personal gain,” said Erick Martinez, Special Agent in Charge of IRS Criminal Investigation's Los Angeles Field Office. “As today’s verdict shows, IRS Criminal Investigation will not stand still while criminals line their pockets with illicit proceeds obtained from publically funded health care programs. The defendants have overstepped their bounds feeling entitled to this benefit program.”
The jury that convicted Pogosian also acquitted him of two counts of money laundering.
This case is the product of an investigation by the Federal Bureau of Investigation; the U.S. Department of Health and Human Services, Office of Inspector General; and IRS Criminal Investigation.