The president of an insurance brokerage firm and the CEO of a marketing firm have been sentenced to 20 years in prison for their long-standing involvement in a $233 million (£173 million) fraudulent scheme to steal from the Obamacare initiative, also known as the Affordable Care Act (ACA) programme.
The defendants convicted for the said scheme are Cory Lloyd, 47, of Stuart, Florida, and Steven Strong, 43, of Mansfield, Texas.
Both fraudulent actors allegedly exploited tens of thousands of vulnerable customers, enrolling them into fully subsidised ACA plans without their proper consent, for which they earned millions of dollars in commission payments from insurance companies.
FBI Statement on the Scheme
According to FBI Director Kash Patel, the defendants designed a business exploitation model targeted at the most vulnerable people. How this model worked was to first manipulate federal health programmes for profit, then put victims at the risk of losing critical medical care, forcing them to lose insurance money to these corporate scheme actors.
'Stealing hundreds of millions of taxpayer dollars while endangering lives is as callous as it gets. The FBI and our partners will continue to track down and hold accountable anyone who treats vulnerable Americans as a payday,' Patel added.
Justice Department Response
'These defendants will rightly spend decades in prison for taking advantage of thousands of vulnerable people and stealing millions from a health care safety net designed for working families,' said Assistant Attorney General A. Tysen Duva of the Justice Department's Criminal Division.
And Attorney General Pamela Bondi termed the fraudulent actions as 'evil' and 'unforgivable,' noting that these actors preyed on medically compromised customers to rob them of huge sums from tax-funded programmes.
Details of the Fraudulent Scheme
According to legal filings and evidence presented at trial, both perpetrators of the said scheme maneuvered individuals struggling with homelessness, addiction, and mental health challenges and jeopardised their access to legitimate medical care through their scheme, which sought over $233 million (£173 million) in fraudulent ACA plan subsidies for which they cashed in at least $180 million (£133 million) from federal government payments.
As per evidence presented at trial, Lloyd and Strong jointly enrolled vulnerable customers in fully subsidised ACA programs using false applications for individuals whose income did not meet the minimum requirements for eligibility.
As a result, these victims were liable to lose as much as life-saving treatments, which were normally covered under their Medicaid insurance or other programmes such as treatments for opioid use disorders, mental health disorders, and serious infectious diseases.
Further findings, according to the DOJ, revealed that Lloyd had received commissions and other financial incentives from an insurance firm in exchange for enrolling consumers in the ACA plans. In turn, Lloyd paid commissions to Strong to gain customer referrals.
To maximise these commissions, Lloyd and Strong used falsified sales documents and other manipulative tactics to coerce customers into stating they would attempt to meet the minimum earning requirement to be eligible for a subsidised ACA plan, despite these customers earlier stating their lack of income to insurance agents.
Evasion of Federal Verification Checks and Luxurious Spending
Both fraudulent actors also tried to evade federal government verification checks on income and other relevant documents and intentionally submitted thousands of applications to Medicaid for various individuals in a way that ensured they never met the eligibility requirements, so as to eventually exploit them through their fraudulent subsidised ACA scheme.
Evidence also surfaced that both parties exchanged text messages, which included conversations where they belittled their victims during their manipulative scheme. The defendants bought expensive assets using the money made from the scheme, including luxury homes, an 80-foot yacht, and a Tesla.
Originally published on IBTimes UK
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