White Collar Crime News

Alleged pill selling Doctors face even more criminal charges August 17, 2009

Every now and then as an attorney, you get a client that is in it really, really deep.  The Sharma’s are those clients for two attorneys.  At 59 years old, they both face enough charges that could result in a de facto life sentence.  This is why it is important for attorneys to examine all financial documents to check for any possible money laundering and the extent of it.  Clients have a way of minimizing the situation and leaving out important details.  While you don’t want to call your client a liar, you don’t want to just accept their word for it either.

HOUSTON—A federal grand jury has returned a superseding indictment adding 35 more counts to the previously returned 29-count indictment against Dr. Arun Sharma and his wife, Dr. Kiran Sharma, M.D., United States Attorney Tim Johnson announced today. Drs. Arun and Kiran Sharma, both 59, operated the Allergy, Asthma, Arthritis and Pain Centers located at on Cole Street in Webster, Texas, and another on Garth Road in Baytown, Texas.

In the original 29-count indictment, the Sharmas were accused of conspiracy to defraud Medicare/Medicaid and private health care providers of more than $31 million by falsely claiming to have administered facet joint injections and blocks to patients and routinely prescribing excessive amounts of hydrocodone, Soma and Xanax to patients that were not for a legitimate medical purpose in exchange for cash payments. The doctors were alleged to have stored large amounts of cash received from the sale of hydrocodone prescriptions at their home. Kiran Sharma allegedly transported large amounts of cash received from the sale of the hydrocodone prescriptions to two safe deposit boxes—one each at Bank of America and Prosperity Bank.

The superseding indictment was returned late Thursday, Aug. 13, 2009. It charges Drs. Arun and Kiran Sharma with three new counts of illegally distributing controlled substances for hydrocodone and methadone prescriptions written to specific patients, four new counts of health care fraud, nine counts of mail fraud, conspiring to launder illegal proceeds and 18 counts of laundering their illegal proceeds by hiding the drug cash in their safe deposit boxes, moving the fraud proceeds between several accounts they controlled and sending fraud proceeds back to India. It is alleged Kiran Sharma visited the two safe deposit boxes a total of 61 times and transported more than $816,000 in cash to the boxes.

The new charges include accusations against the Sharmas of prescribing more than 8,000 tablets of hydrocodone to one patient over an eight-month period. In two other counts, they are charged with prescribing 540 tablets of hydrocodone to one patient on May 23, 2005, and another 540 tablets to the same patient on Dec. 5, 2005.

Additionally, the forfeiture notice provision of the original indictment has been expanded to include the following assets which the government intends to forfeit as proceeds/property derived from their alleged illegal activity: 12 pieces of real estate including the defendants’ Kemah residence and both of their clinics, 32 investment accounts, 23 bank accounts and the $1.5 million in cash seized from the defendants’ home and safe deposit boxes for a total of $31 million.

The court has ordered the Sharmas, who are free on bond, to appear in federal court on Aug. 21, 2009, for arraignment on the new charges.

Upon conviction, health care fraud carries a maximum penalty of 10 years in a federal prison and a $250,000 fine. The fraud conspiracy charge and the mail fraud counts each carry a maximum penalty of 20 years in a federal prison and a $250,000 fine. The drug conspiracy and the 10 Schedule III drug distribution counts carry a penalty of five years imprisonment and a $250,000 fine. The three new Schedule II drug distribution counts carry a penalty of 20 years imprisonment and a $1 million fine. The money laundering conspiracy and the individual money laundering counts carry a maximum penalty from 10 to 20 years and a fine of $250,000 to $500,000.

The criminal charges are the result of a joint investigation being conducted by agents of the FBI, Drug Enforcement Administration, the Department of Health and Human Services-Office of Inspector General and the Medicare Fraud Control Unit of the Texas Attorney General’s Office in conjunction with the Webster, League City and Baytown Police Departments. The case will be prosecuted by Assistant United States Attorney Al Balboni.