Mohamad Mokbel led a company called 4M Pharmaceuticals which actually operated fourteen pharmacies with straw owners. A straw owner is a person who owns a business or part of a business but does so on behalf of another, usually to hide the true owner’s real identity. Appearances can be deceiving. A pharmaceutical store front owned by a straw owner is a perfect set up for fraudulent endeavors. Which apparently Mokbel had! On October 17, 2024, Mokbel was found guilty of a $160 million Medicare scheme that targeted elderly diabetic patients who are dependent on diabetic testing supplies to manage their blood sugar levels.
Mokbel started his scheme by first illegally purchasing private information on thousands of Medicare beneficiaries, including their identification number, personal health and physician information. He then directed his 4M employees to run insurance claims using the Medicare beneficiaries’ patient data to determine if Medicare or other insurance plans would cover the claims. Mokbel would then bill fraudulent claims at high rate for the topical creams, Omega-3 pills and other medications that he intended to sell through 4M pharmacies. 4M employees would fax pre-filled prescription requests to the patients’ doctors appearing to be for diabetic testing supplies. Appearances can be deceiving! Mokbel would add topical creams expenses that he could supply at the bottom of the invoice anticipating that the doctor would overlook the unnecessary medication. To ensure that he would be able to ship the products, Mokbel would also include false representations that the patient was requesting a 4M Pharmacy fill their medications prescriptions.
Outstanding job by all the departments that helped in this case including the FBI, IRS Criminal Investigation, Homeland Security Investigations, Department of Health and Human Services, and the Food and Drug Administration. Large schemes like Mokbel’s, take a lot of resources away from the government helping U.S. citizens in need.
Today’s Fraud of The Day is based on article “Houston pharmacy owner found guilty in $160 million Medicare fraud’ published by Click2Houston News on October 17, 2024
Justice has been served for a Houston pharmacy owner who was found guilty of Medicare fraud that resulted in hundreds of millions of dollars. According to the U.S. Dept. of Justice Southern District of Texas, Mohamad Mokbel, 59, was the owner of a company called 4M Pharmaceuticals, which from 2014 through 2021, operated 14 pharmacies with what prosecutors described as “straw owners.”
The pharmaceutical company essentially functioned as an outbound telemarketing call center that solicited Medicare, Medicaid, and commercial insurance patients nationwide – many over the age of 55.