Lakewood Resident Pleads Guilty to $21.7M Healthcare Fraud and COVID-19 Wire Scam
June 30, 2023
NEWARK, N.J. – A man from Ocean County, New Jersey, has confessed to playing a role in a kickback scheme involving durable medical equipment, announced U.S. Attorney Philip R. Sellinger today.
Alexander Schleider, a 57-year-old resident of Lakewood, New Jersey, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court. The plea was in response to one count of conspiracy to commit health care fraud and one count of wire fraud.
Based on court documents and statements, it was revealed that Schleider owned and operated durable medical equipment (DME) companies in New Jersey. These companies provided orthotic braces to beneficiaries of Medicare and other federal and private health care benefit programs, regardless of medical necessity. To obtain prescriptions for the DME braces, Schleider and his co-conspirators paid kickbacks and bribes to individuals operating marketing call centers. These individuals, in turn, used the services of telemedicine companies to obtain the necessary prescriptions. As a result of their actions, Schleider and his co-conspirators caused losses amounting to $21.7 million to Medicare and other health care benefit programs.
In addition to the health care fraud charges, Schleider also committed wire fraud related to funds allocated in response to the COVID-19 pandemic. After one of his DME companies received $322,237 from the Department of Health and Human Services’ Health Resources and Services Administration Provider Relief Fund, Schleider submitted a fraudulent attestation to HRSA. The attestation falsely claimed that his company provided diagnoses, testing, and care for individuals with COVID-19. In reality, the company had ceased billing for any services in April 2019. Furthermore, the attestation also falsely stated that the payment would be used exclusively for coronavirus-related purposes. Schleider, however, transferred the funds into other accounts and used them for personal purchases, including real estate and vehicles.
Schleider now faces severe consequences for his actions. The charge of conspiracy to commit health care fraud carries a maximum potential penalty of 10 years in prison, along with a fine of $250,000 or twice the gross profit or loss caused by the offense. The charge of wire fraud, on the other hand, is punishable by a maximum potential penalty of 20 years in prison and the same fine. The sentencing is scheduled for November 8, 2023.
U.S. Attorney Sellinger expressed his gratitude to the special agents of the FBI, the Department of Health and Human Services-Office of Inspector General, and the U.S. Department of Veterans Affairs Office of Inspector General for their diligent investigation that led to the successful conclusion of this case.
The case is being prosecuted by Assistant U.S. Attorneys Sean M. Sherman and DeNae Thomas from the Health Care Fraud Unit in Newark.
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Defense counsel: Marc Agnifilo Esq., New York
