A Federal judge last week received the guilty pleas of a Louisiana couple accused by prosecutors of operating a medical reimbursement program that allegedly defrauded participants and the IRS of over $48 million.
The 53-year-old man and his 52-year-old wife appeared before U.S. District Judge Carl J. Barbier of the Eastern District of Louisiana to enter their pleas last Wednesday. The male defendant pled guilty to one count of conspiracy to commit money laundering, the female defendant pled guilty to guilty to one count of conspiracy to defraud the United States, and their company pled guilty to guilty to one count of conspiracy to make false statements and representations in connection with a multiple employer welfare arrangement and five counts of making false statements and representations in connection with a multiple employer welfare arrangement.
In their guilty pleas the couple said they created a medical reimbursement program in 2012 that claimed to be a supplemental insurance program that reimbursed employees for co-pays and deductables. The complex arrangement involved a contribution of several hundred dollars from the employee to be covered, a loan to the employee to cover the contribution, an insurance policy on the employee to pay out to the lender should the employee die before repaying the loan, and various fees paid by both the employer and the employee to the firm. In addition, the employees were to have made monthly contributions and the employer was to match a percentage of those contributions in payment to the firm.
However, investigators discovered that nothing but a few incidental fees were ever paid by employees to the firm. The entire scheme was established as a vehicle for reducing the taxable wages of the participants involved in the conspiracy. All told, the defendants are accused of causing the underpayment of at least $23 million in FICA taxes, plus underreporting and underpayment of individual state and federal income taxes.
The duo is scheduled to be sentenced by Judge Barbier in early September. In addition to a probable prison sentence, the defendants agreed to forfeit $6.3 million in assets and to pay restitution to victims in the amount of over $48 million.
The Law Offices of Bjorn Brunvand have been representing people charged with capital murder, felony drug charges, drunk driving, government fraud, and white-collar crimes for over a quarter century. Contact our office today to discuss your Tampa Bay-area state or federal charges.