SANTA ANA, Calif.—Ten substance abuse facility owners and patient recruiters in Orange County were criminally charged by the Department of Justice (DOJ) on Dec. 16, for kickback schemes involving exploiting addiction patients seeking help.
For 10 months, The Sober Homes Initiative in Southern California, an anti-fraud initiative led by the DOJ’s Health Care Fraud Unit and the U.S. Attorney’s Office, targeted addiction treatment facilities in Orange County.
The investigations led to 10 suspects with criminal charges; four were taken into custody, including three from the county.
“Driven by greed, dishonest operators of substance abuse treatment centers have invaded Southern California,” U.S. Attorney Tracy L. Wilkison said in a statement.
The “corrupt individuals,” Wilkison said, targeted vulnerable addicts with generous health insurance benefits and took advantage of the nation’s opioid crisis by fueling what he referred to as a “patient-selling network.”
Depending on the patient’s type of insurance, the defendants allegedly paid the recruiters with recurring monthly payments for each patient referred to their addiction treatment facilities, recovery homes, or laboratories.
“Receiving kickbacks for patient referrals endangers lives and has no place in our health care system,” California Insurance Commissioner Ricardo Lara said in the statement.
Nick Roshdieh, 51, of Aliso Viejo, and Vincent Bindi, 66, of Laguna Niguel, who owned Crest Recovery LLC, doing business as Truvida Recovery, were both arrested on charges in an indictment for allegedly paying and receiving kickbacks for referrals to sober living homes, according to a statement by the department.
Roshdieh and Bindi both face up to 65 years in prison.
Donald Vawter, 30, of Rancho Santa Margarita, an employee of Truvida, and Michael Hislop, 56, of Boston, Massachusetts, a patient recruiter, were also arrested and charged with conspiring to pay and receive kickbacks for referrals to a substance abuse treatment facility.
Vawter and Hislop both face up to 35 years in prison.
Casey Mahoney, 45, of Los Angeles, and Joseph Parkinson, 32, formerly of Costa Mesa, were indicted in a multimillion-dollar addiction treatment kickback scheme last October.
In addition to paying and receiving kickbacks for patient referrals, the department charged Mahoney with money laundering for fraudulently transferring kickback funds to a patient broker’s mother.
Mahoney faces up to 35 years of prison.
Parkinson, a patient recruiter, was charged with currency structuring—making one or more money transactions for the purpose of evading reporting requirements—possession with intent of fentanyl distribution, and paying and receiving kickbacks for referrals to sober living homes.
Parkinson faces up to 165 years in prison.
“Fraudulent kickbacks in the substance abuse treatment field create perverse incentives for patient recruiters that oftentimes leave addicts in a toxic cycle of drug use and treatment,” said Kristi K. Johnson, the assistant director in charge of the FBI’s Los Angeles Field Office, in the statement.
“The FBI is committed to fighting fraud in the healthcare system so that those struggling with addiction can find legitimate care and encourages patients and employees to report kickback schemes.”
Below are other allegations resulting from the investigation.
Darius Moore, 28, formerly of Santa Ana, pleaded guilty last December for conspiracy to pay and receive kickbacks for referrals to sober living homes.
Moore, who received approximately $488,500 in kickbacks in exchange for his referrals, is scheduled to be sentenced on May 13, 2022, where he will face up to 15 years in prison.
Adrian Gonzalez, 37, of Laguna Hills, who controlled Stone Ridge Recovery Inc. and Landmark Recovery LLC, pleaded guilty last August for paying at least $1 million in kickbacks to patient recruiters.
Gonzales will serve up to 10 years in prison and is scheduled to be sentenced on Jan. 28, 2022.
Dorian Ballough, 30, formerly of Costa Mesa, pleaded guilty last month to one count of conspiracy for paying and receiving kickbacks for referrals.
Ballough, who acted as a patient recruiter for multiple addiction treatment facilities in the county and paid at least $1.8 million in kickbacks in exchange for patient referrals, faces up to 15 years in prison and is scheduled to be sentenced on April 8, 2022.
Kyle Reed, 29, formerly of Huntington Beach, pleaded guilty last month to one count of conspiracy for paying and receiving kickbacks for referrals to sober living homes.
Reed, a patient recruiter for multiple treatment facilities in the county, paid at least $604,474 in exchange for patient referrals.
He faces up to 15 years in prison and is scheduled to be sentenced on May 6, 2022.
The Department of Justice declined a request for further comment.