The owner of a now-defunct Elsa durable medical equipment business will serve more than three years in prison and ordered to pay back nearly $900,000 in restitution.
U.S. District Judge Micaela Alvarez sentenced Everardo Villarreal to a 40-month prison sentence, with an additional three years of supervised release upon completion of the prison term.
As part of the plea agreement reached in June; Villarreal agreed to plead guilty to one count of attempt and conspiracy to commit mail fraud; in return, he agreed to pay back $869,693.92 beginning two months after he completes his prison term at $500 per month, until paid off.
The government also agreed to dismiss three counts of health fraud, and two counts of fraud with identification documents, the document shows.
Villarreal and his now-former secretary Delilah Rae Robles, were accused in a seven-count indictment of concocting a scheme to defraud federal and state healthcare benefit programs of more than $850,000. The indictment alleged the pair submitted more than $1.5 million in claims.
Alvarez also sentenced Robles, who was handed a time-served sentence, taking into account that she was in custody for roughly 20 days after her initial arrest in late February.
She will be required to serve the next six months under home confinement, three years of supervised release at the end of the home confinement, and will also be required to pay back the $869.693.92 in restitution, with $500 installments per month, beginning two months from the sentencing date, records show.
According to the eight-page unsealed indictment, Villarreal, owner of the now-shuttered Elsa-based DME Medical Supply Depot, and Robles, who Villarreal employed as his secretary, conspired to defraud Texas Medicaid by submitting fake claims in an effort to “unlawfully enrich” themselves.
Government prosecutors allege that the scheme, which began sometime in April 2010, and ended more than four years later in September 2014, was executed by Villarreal and Robles “by submitting or causing others to submit false and fraudulent claims to Medicaid,” the record shows.
In some instances, Villarreal allegedly paid kickbacks to an unnamed co-conspirator, referred to in the indictment by the initials “B.D.,” the document read.
The 46-year-old man, a native of Edinburg, paid B.D. kickbacks in the form of checks in exchange for patient information — specifically the names and personal identification numbers of Medicaid beneficiaries.
“As part of the kickback arrangement between Villarreal and B.D., B.D. bought back incontinence supplies from certain Medicaid beneficiaries whose patient information Villarreal purchased from B.D.,” the indictment read. “Villarreal used the patient information purchased from B.D. to submit or cause others to submit false and fraudulent claims to Medicaid in order to cause Medicaid to render payment.”
In addition, Villarreal instructed the 39-year-old woman, of Weslaco, to bill Medicaid for supplies that had not been delivered to Medicaid beneficiaries.
“Robles coordinated with B.D. to supply patient information to Villarreal in exchange for kickback payments from Villarreal,” the document read. “The defendants and their co-conspirators offered to pay cash to Medicaid beneficiaries in exchange for supplies.”
Robles will begin her home confinement term immediately, while Villarreal, who is out on a $50,000 bond, will remain free pending the determination of a surrender date by the court.