U.S. Attorney Philip R. Sellinger | U.S. Department of Justice
A California resident has admitted to his involvement in a scheme that defrauded Medicare of over $10 million, according to an announcement by Attorney for the United States Vikas Khanna. Adam Wayne Owens, aged 44 and from Riverside, California, pleaded guilty before U.S. District Judge Michael E. Farbiarz in Newark. He faced one count of conspiracy to violate the federal Anti-Kickback Statute.
Court documents and statements reveal that between November 2018 and January 2020, Owens engaged in a kickback and bribery operation with testing companies for at-home cancer genetic tests (CGX). Owens owned marketing companies in California which were used to identify Medicare beneficiaries for CGX testing. Personal and medical information about these beneficiaries was provided to testing companies, leading to the distribution of CGX test kits. Once completed tests were returned, claims for reimbursement were submitted to Medicare. For each reimbursed test, Owens' companies received kickbacks ranging from $1,700 to $2,000.
To hide the illegal activity, kickback payments were wired by testing companies to a New Zealand company before being transferred to bank accounts controlled by Owens in the United States. A sham contract was established between Owens' marketing company and the New Zealand entity under the guise of legitimate marketing services. In reality, payments received were based on the number of CGX tests reimbursed by Medicare.
The fraudulent scheme resulted in losses exceeding $10 million for Medicare. The charge of conspiracy carries a maximum penalty of five years imprisonment and a fine up to $250,000 or twice the financial gain or loss caused by the offense.
Special agents from various agencies contributed to this investigation: FBI agents under Special Agent Brian Driscoll; Department of Health and Human Services-Office of Inspector General led by Naomi Gruchacz; U.S. Department of Defense's Defense Criminal Investigative Service directed by Patrick J. Hegarty; and U.S. Department of Veterans Affairs Office of Inspector General under Christopher F. Algieri.
The case is prosecuted by Assistant U.S. Attorneys Garrett J. Schuman and Katherine M. Romano from the Health Care Fraud Unit along with Senior Trial Counsel Barbara A Ward from the Asset Recovery and Money Laundering Unit.
