Three Arrested on Suspicion of Fraud in Orange County

Two consultants and a marketer are facing federal fraud charges for falsely billing health insurance programs for over $50 million. According to a news report in The Orange County Register, a federal grand jury indicted the three individuals on multiple counts of mail fraud. Officials believe they lured patients to an Orange surgery center for medical procedures that they were told were covered by their health insurance plans. These allegedly unnecessary procedures such as tummy tucks, nose jobs, liposuctions and breast augmentations resulted in false bills.

The alleged scheme resulted in over $50 million of claims to union and PPO health-care benefit programs. The 30-year-old marketer from San Pedro and the 31- and 44-year-old consultants from Placentia and Tustin respectively, could each face a maximum sentence of 20 years in federal prison for every count of mail fraud.

Individuals could also face mail fraud charges in Orange County if they send false information through the U.S. Postal Service for financial benefit. The mail fraud statute was originally enacted by Congress to protect the United States Postal Service and wires such as radio and television. Mail fraud and wire fraud now includes all private and commercial carriers such as FedEx or the UPS as well as additional forms of communication including facsimile, telephone, modem and Internet transmissions.

In order to prove mail fraud, the prosecution must show beyond a reasonable doubt that the defendant:

  • Was involved in a scheme to defraud
  • Used the mail to further that scheme
  • Had intent to commit fraud

No actual loss is required for a conviction. In fact, the scheme to commit fraud does not have to result in financial gain. The prosecution only has to prove that you used the mail to try to pull off a fraud. If the prosecution is successful, you could face up to 20 years in prison for each count of mail fraud.

If you have been arrested on suspicion of fraud, contact an experienced Orange County fraud defense lawyer, David A. Stein for a no-cost consultation.  Call 949-445-0040 today or contact us online by email here.