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TRENTON
– Attorney General Anne Milgram today
announced the arrests of 13 people, including
doctors and pharmacists, in the takedown of
a major criminal narcotics network in Hudson
County that was responsible for the black
market distribution of thousands of prescription
pain pills such as OxyContin and Percocet.
According
to Criminal Justice Director Deborah L. Gramiccioni,
the arrests stem from Operation MedScam, a
year-long investigation by the Medicaid Fraud
Control Unit of the Division of Criminal Justice’s
Office of Insurance Fraud Prosecutor and the
Jersey City Police Department’s Special
Investigation Unit. The ongoing investigation
uncovered a criminal network that was obtaining
fraudulent narcotics prescriptions from doctors
and filling them at various pharmacies. Medicaid
and private insurers were being billed for
phony prescriptions and doctor visits.
“These
defendants ripped off Medicaid and sold dangerous
narcotics on the street, peddling black market
pain pills such as OxyContin. With these arrests,
we have shut down their two-pronged criminal
enterprise,” said Attorney General Milgram.
The
arrests made late yesterday and today (Oct.
19 and 20), include three alleged ringleaders:
Robert Silverman, 43, of
Jersey City; Louis Lisi,
34, of Union City; and Brian Kelly,
48, of Hoboken. Silverman allegedly ran his
own ring, while the other two allegedly worked
together. However, the rings allegedly used
the same pharmacists to obtain narcotics and
at least one of the same doctors to write
prescriptions. They also sometimes supplied
each other with pills. During the arrests,
more than 1,000 pills were recovered from
the individuals and locations searched.
The
leaders allegedly paid Medicaid beneficiaries
to obtain fake prescriptions for painkillers
and other drugs from two doctors, Dr.
Clifton Howell, 53, of West Orange,
whose medical practice is at 550 Newark Ave.,
Jersey City, and Dr. Magdy Elamir,
56, of North Saddle Brook, whose practice
is at 550 Summit Ave., Jersey City. Both of
those doctors were arrested.
Two
pharmacists were arrested. They are Babak
Bamdad, 41, pharmacist in charge
at Tucker Drugs, 1000 Washington St., Hoboken,
and Amir Tadros, 32, pharmacist
in charge at Five Corners Pharmacy, 591 Summit
Ave., Jersey City.
Six
other individuals were arrested as alleged
street-level distributors for the narcotics
rings. They are Joseph Burkhardt,
50, of Jersey City; Michele J. Oliver,
41, of Wallington; John Bussanich,
23, of Cliffside Park; Danny Reed,
25, of Toms River; Marty Taraboccia,
25 of Fairview; and Jack Kennedy,
28, of Keyport.
The
rings allegedly distributed the prescription
pain pills throughout Hudson County and other
parts of the state, including Bergen, Ocean,
Morris and Monmouth counties. A single 30
milligram OxyContin pill, known as a “blue,”
typically sells for $10 to $20 on the street,
while a 10 milligram Percocet pill sells for
$5 to $8.
The
arrests were made by detectives and officers
of the Division of Criminal Justice and Jersey
City Police Department.
“Operation
MedScam targeted and uncovered every aspect
of these narcotics rings, from the ringleaders,
to the doctors who wrote phony prescriptions,
to the pharmacists who filled them, to the
distributors who sold the pain pills on the
street,” said Director Gramiccioni.
“These arrests are the result of a highly
effective partnership between our Medicaid
Fraud Control Unit and the Jersey City Police
Department.”
Jersey
City Chief of Police Thomas Comey stated “I
would like to commend everyone involved in
Operation MedScam. Greed and the illegal narcotics
trade know no boundaries. This operation shows
the commitment by law enforcement to arrest
and prosecute offenders regardless of their
social, professional or economic standing.
Operation MedScam is further proof that cooperation
among the law enforcement community can produce
great results.”
The
investigation revealed that the two doctors,
Howell and Elamir, were allegedly writing
prescriptions for Medicaid beneficiaries in
exchange for cash or the ability to bill Medicaid,
without requiring medical need or a medical
examination. Howell allegedly demanded $75
per visit, while Elamir allegedly demanded
$50. In other instances, the doctors allegedly
wrote prescriptions for narcotics based only
on names provided to them by the ringleaders.
The
Medicaid beneficiaries would ask for prescriptions
for narcotics as well as non-narcotic medications,
typically high-priced maintenance drugs such
as asthma or allergy medications. The doctors
allegedly wrote both the narcotic and non-narcotic
prescriptions. The Medicaid beneficiaries
took the prescriptions to the pharmacies to
obtain the narcotics, or in some instances,
Silverman or other ring members obtained the
narcotics themselves.
The
two pharmacists who were arrested, Bambad
and Tadros, allegedly filled fraudulent narcotics
prescriptions for the criminal network. They
allegedly demanded cash for the pain pills
because they did not want to bill Medicaid
or private insurers for narcotics, which are
closely monitored. However, they would provide
the painkillers at a discount or without charge
if they were also given prescriptions for
other non-narcotic medicines, such as the
high-priced asthma medication Advair. They
allegedly billed Medicaid and private insurers
for the non-narcotic prescriptions without
ever dispensing the medications.
“As
we have seen historically, this type of health
care fraud and street level distribution doesn't
occur without the involvement of the medical
providers,” said Acting Insurance Fraud
Prosecutor Riza Dagli. “Criminal activity
by doctors, pharmacists, and other professionals
who are in a position of public trust is particularly
egregious and is a priority for this office.”
Investigators
executed search warrants at the homes of Silverman
and Lisi. Searches of the doctors’ offices,
Tucker Pharmacy and Five Corners Pharmacy
were underway.
Bank
accounts containing more than $1 million were
seized today. They were seized in connection
with an action filed by the Division of Criminal
Justice to seize and forfeit assets as alleged
proceeds and instruments of the defendants’
criminal activities, including residential
and commercial real estate, vehicles, bank
accounts and safe deposit boxes
In
addition, approximately $7,000 in cash was
seized from Lisi and his house, along with
several falsely labeled prescription bottles,
a quantity of OxyContin pills, and several
fraudulent prescriptions for narcotics. Another
$8,000 was seized from a safe deposit box
in Lisi’s name. Approximately $20,000
was seized at Silverman’s house, along
with crack cocaine, a quantity of OxyContin
pills, and several falsely labeled prescription
bottles.
The
defendants were charged as follows:
Alleged
Leaders
- Robert
Silverman - Distribution of Controlled Dangerous
Substance (CDS) Within 500 Feet of Certain
Public Property (2nd degree), Distribution
of CDS (3rd degree).
-
Louis Lisi - Distribution of CDS Within
500 Feet of Certain Public Property (2nd
degree), Distribution of CDS (3rd degree)
(2 counts), Endangering the Welfare of a
Child (2nd degree).
-
Brian Kelly - Distribution of CDS Within
500 Feet of Certain Public Property (2nd
degree), Distribution of CDS (3rd degree),
Distribution of CDS Within 1,000 Feet of
School (3rd degree).
Doctors
- Dr.
Clifton Howell - Distribution of CDS (2nd
degree), Health Care Claims Fraud (2nd degree),
Medicaid Fraud (3rd degree).
-
Dr. Magdy Elamir - Distribution of CDS (2nd
degree), Health Care Claims Fraud (2nd degree),
Medicaid Fraud (3rd degree).
Pharmacists
- Babak
Bamdad - Health Care Claims Fraud (2nd degree),
Medicaid Fraud (3rd degree).
-
Amir Tadros - Health Care Claims Fraud (2nd
degree), Medicaid Fraud (3rd degree).
Alleged
Drug Distributors
Burkhardt
and Kennedy were each charged with Distribution
of CDS Within 500 Feet of Certain Public
Property (2nd degree), Distribution of CDS
(3rd degree), and Distribution of CDS Within
1,000 Feet of School (3rd degree). Reed
and Oliver were each charged with Conspiracy
to Distribute CDS (3rd degree). Taraboccia
and Bussanich were each charged with Possession
of CDS with Intent to Distribute (2nd degree).
Additional
arrests are expected.
Attorney
General Milgram credited Detective Kevin Gannon
and Sgt. Fred Weidman of the Office of Insurance
Fraud Prosecutor’s Medicaid Fraud Control
Unit for leading the investigation under the
Supervision of Deputy Attorney General Erik
Daab, Deputy Chief of the Medicaid Fraud Control
Unit, and Deputy Attorneys General Debra Conrad
and Cynthia Vazquez.
They
were assisted by the following members of
the Jersey City Police Department’s
Special Investigation Unit under the supervision
of Chief Thomas Comey: Capt. Gary Lallo, Sgt.
Anthony Musante, Sgt. Wally Wolf, Detective
Wael Shahid, Detective Jeff Guilfoyle, Detective
Vincent Disbrow, Detective Hector Marrero,
Police Officer Alex Torres, Police Officer
Chris Dolan, and Police Officer Erik Infantes.
Deputy
Attorney General Carol Stanton Meier, Detective
Sgt. Scott Naismyth and Analyst Bethany Schussler
are handling the asset forfeiture action for
the Division of Criminal Justice.
The
arrested defendants were being held in the
Hudson County Jail in lieu of bails ranging
from $75,000 to $150,000. They are expected
to be arraigned tomorrow before Superior Court
Judge Kevin G. Callahan.
The
charges are merely accusations and the defendants
are presumed innocent until proven guilty.
The investigation will be presented to a state
grand jury for review and potential indictment.
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