TRENTON
- Attorney General Anne Milgram announced
that a co-owner of two pharmacies in East
Orange and Jersey City was sentenced to prison
today for fraudulently billing the Medicaid
program hundreds of thousands of dollars for
HIV/AIDS drugs that were never dispensed.
According to Insurance Fraud Prosecutor Greta
Gooden Brown, John Borges, 45, of Piscataway,
was sentenced to three years in state prison
by Superior Court Judge Michael A. Petrolle
in Essex County. Borges also must pay fines,
restitution and forfeiture of $762,000.
Borges and Abdul Bari, 54,
of Nutley, were co-owners of MLK Pharmacy
on M.L.K Drive in Jersey City and Ampere Pharmacy
on 4th Avenue in East Orange. Borges ran Ampere
Pharmacy. Both men pleaded guilty last year
to second-degree health care claims fraud
and third-degree filing a false or fraudulent
New Jersey income tax return.
In
pleading guilty, the two men admitted that
between January 2005 and October 2007, they
fraudulently submitted bills to Medicaid for
HIV/AIDS drugs that were never dispensed.
They admitted that they purchased prescriptions
from Medicaid beneficiaries for a small fraction
of the cost of the drugs prescribed, and in
turn billed Medicaid thousands of dollars
without dispensing the drugs. An investigation
led by the Medicaid Fraud Control Unit of
the Office of the Insurance Fraud Prosecutor
revealed that the fraudulent bills totaled
hundreds of thousands of dollars.
Additionally, both Borges and Bari admitted
that they filed fraudulent personal income
tax returns with the New Jersey Division of
Taxation for tax years ending in 2004 through
2006.
Bari was sentenced to three
years in state prison on December 5, 2008
by Superior Court Judge Kevin G. Callahan
in Hudson County. Bari must pay approximately
$500,000 in fines, restitution and forfeiture.
The Attorney General’s
Office instituted an asset forfeiture case
involving Borges in October 2007, when it
seized approximately $676,000 in cash from
him, as well as two parcels of real estate
and two vehicles. In settling the forfeiture
case, Borges agreed to relinquish his interest
in $762,000. Restitution in the amount of
$507,610 will be paid to the Medicaid program
from the total settlement with Borges. Restitution
of $69,390 will be paid to the New Jersey
Division of Taxation. The remaining funds
will applied to fines and forfeiture.
The Attorney General’s
Office also instituted an asset forfeiture
case in October 2007 against assets of Bari,
seizing property valued at approximately $322,000,
including a parcel of real estate, bank accounts
and two vehicles. In settling the forfeiture
case, Bari agreed to relinquish his interest
in all seized assets and to pay an additional
$178,197. The settlement money will be used
to pay $257,628 in restitution to the Medicaid
program, and $45,672 in restitution to the
New Jersey Division of Taxation. The remaining
funds will be paid as fines and forfeiture.
Another co-owner of MLK Pharmacy,
Shahid Mahmood, 49, of Jersey City, pleaded
guilty on June 11 to second-degree health
care claims fraud. He is scheduled to be sentenced
by Judge Callahan on July 23. The state will
recommend that Mahmood be sentenced to three
years in state prison and be ordered to pay
$216,220 in restitution and fines.
“By defrauding the Medicaid
program, this defendant not only stole tax
dollars, he stole from a program dedicated
to providing health care coverage for persons
who otherwise could not afford it,”
said Insurance Fraud Prosecutor Greta Gooden
Brown. “Such cases are a priority for
the Office of Insurance Fraud Prosecutor.”
Detective Kevin Gannon, Detective
Joseph Jaruszewski and Deputy Attorney General
Erik W. Daab were assigned to the investigation
into this case. Deputy Attorney General Daab
represented the Office of Insurance Fraud
Prosecutor at the sentencing.
Sgt. James Wrightson and Deputy
Attorney General Carol Stanton Meier were
assigned to the asset forfeiture case for
the Office of Insurance Fraud Prosecutor.
The Jersey City Police Department also assisted
in this investigation. Prosecutor Brown thanked
the Jersey City Police Department for their
valuable assistance.
The
Medicaid program is funded by the state and
federal governments. The State of New Jersey
administers the Medicaid program through the
Division of Medical Assistance and Health
Services and through the Office of Insurance
Fraud Prosecutor’s Medicaid
Fraud Control Unit, which investigates
both criminal and civil Medicaid fraud and
abuse in that program.
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