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For Immediate Release:
For Further Information:
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August 18, 2010

Office of The Attorney General
- Paula T. Dow, Attorney General
Division of Criminal Justice
- Stephen J. Taylor, Director
Office of the Insurance Fraud Prosecutor
- Riza Dagli, Acting Insurance Fraud Prosecutor

Media Inquiries-
609-292-4791
Citizen Inquiries-
609-292-4925

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Hoboken Pharmacist Sentenced for Medicaid Fraud

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TRENTON - Attorney General Paula T. Dow and Criminal Justice Director Stephen J. Taylor, announced that a Hoboken pharmacist was sentenced today for his role in a scheme to defraud the Medicaid program.

According to Acting Insurance Fraud Prosecutor Riza Dagli, Babak Bamdad, 42, of Hoboken, was sentenced to 180 days in jail as a condition of three years of probation by Superior Court Judge Kevin G. Callahan in Hudson County. He was ordered to pay restitution in the amount of $10,000 to the Jersey City Police Department and a $30,000 civil penalty to the New Jersey Division of Medical Assistance and Health Services. Bamdad pleaded guilty on June 1 to an accusation charging him with third-degree Medicaid fraud, which was filed by the Office of the Insurance Fraud Prosecutor’s Medicaid Fraud Control Unit.

In pleading guilty, Bamdad, a pharmacist in charge at Tucker Drugs on Washington Street in Hoboken, admitted that between Jan. 1 and Oct. 9, 2009, he submitted claims to the Medicaid program for prescription drugs allegedly dispensed to Medicaid beneficiaries, even though the drugs were never dispensed. The claims were subsequently paid out by the Medicaid program.

The state’s investigation revealed that Bamdad accepted fictitious prescriptions for Prevacid, Advair and Singulair from undercover detectives as payment for narcotic prescription drugs. Bamdad then billed and was paid by Medicaid for the Prevacid, Advair and Singulair even though the prescriptions were not filled or dispensed.

Deputy Attorney General Debra A. Conrad represented the state at the sentencing. The sentence resulted from an ongoing investigation by the Office of the Insurance Fraud Prosecutor’s Medicaid Fraud Control Unit and the Jersey City Police Department’s Special Investigation Unit.

Since October 2009, more than 32 people, including doctors and pharmacists, have been arrested in the joint investigation, which uncovered a major criminal narcotics network based in Hudson County that distributed thousands of black market prescription pain pills such as OxyContin and Percocet. The network was obtaining fraudulent narcotics prescriptions and filling them at various pharmacies. At the same time, Medicaid was being billed for phony doctor visits and prescription medicines that were never dispensed.

The network 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.

Detective Kevin Gannon, Sgt. Frederick Weidman and Deputy Attorneys General Conrad and Cynthia Vasquez were assigned to the investigation. 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.

“Abuse of the Medicaid Program and insurance fraud by persons who hold professional licenses are particularly disturbing crimes,” said Acting Insurance Fraud Prosecutor Dagli. “Not only do such Medicaid fraud schemes involve theft of tax dollars, they also represent a theft from a program designed to assist persons who cannot afford health insurance or health care services. Such cases are a priority for the Office of the Insurance Fraud Prosecutor.”

The Medicaid program, which is funded by the state and federal governments, provides health care services and prescription drugs to persons who may not otherwise be able to afford them. The State of New Jersey administers the Medicaid program through the Division of Medical Assistance and Health Services and through the Office of the Insurance Fraud Prosecutor’s Medicaid Fraud Control Unit, which investigates and prosecutes both civil and criminal Medicaid fraud cases.

Acting Insurance Fraud Prosecutor Dagli noted that people can report Medicaid fraud and insurance fraud anonymously by calling the toll-free hotline 1-877-55-FRAUD or visiting www.NJInsurancefraud.org . State regulations permit a reward to be paid to an eligible person who provides information that leads to an arrest, prosecution and conviction for insurance fraud.

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