Jersey returns proceeds of crime $667,000 after Covid-era Medicare kickback conviction

More than $667,000 held in Jersey bank accounts linked to a convicted US healthcare fraudster has been transferred to the US Department of Justice, Jersey’s Law Officers’ Department has said.

• The money is part of a $2,645,891.55 forfeiture order imposed after Gustavo Geraldes was convicted in April 2022 of conspiracy to offer and pay healthcare kickbacks.

• US authorities later found that funds had been moved to Jersey and asked the Attorney General to restrain the accounts and enforce the American order.

Geraldes was prosecuted in the U.S. District Court for the Southern District of Florida (Case No. 1:22-cr-20141).

• Public docket records show he was charged by criminal complaint in August 2021, waived indictment, and pleaded to a one-count felony information filed on 8 April 2022 that included a forfeiture allegation.

• The case was closed on 18 November 2022.

• No official US Department of Justice press release naming laboratories or co-defendants appears to have been published.

According to Jersey and BBC accounts of the US findings,

• Geraldes ran a scheme in which telemedicine providers authorised medically unnecessary genetic tests at laboratories he part-owned.

• The arrangement exploited temporary COVID-era relaxations of telehealth rules, which were intended to make it easier for Medicare patients to obtain care at home.

• Medicare is the federal programme that pays for healthcare for older and disabled Americans.

The US court ordered forfeiture of $2,645,891.55 as proceeds of the offence. Only the $667,000 located in Jersey has been remitted so far.

• That sum was sent to the Department of Justice to offset losses to Medicare.

• It is not a payment to individual patients.

The US requested mutual legal assistance. Jersey’s Attorney General obtained a saisie judiciaire over the Island accounts and registered the US forfeiture order for enforcement.

• The Royal Court judgment, if one was issued, does not appear on the public Jersey Law reports under Geraldes’s name.

Attorney General Matthew Jowitt KC said:

• “The Mutual Legal Assistance Team in the Law Officers’ Department has worked closely with the US Department of Justice in this case involving a large-scale healthcare fraud.

• The case is a further example of the highly effective working relationship between the two jurisdictions in fulfilling the purpose of the confiscation regime.”

The company names of the laboratories, the Jersey bank, and any corporate structures used to hold the accounts have not been published in the available official summaries.

• Those details, if they exist on the public record, are most likely in the sealed or paywalled PACER filings in Miami — principally the August 2021 complaint and the April 2022 information and forfeiture order.

Reported story

• More than $600,000 held in Jersey bank accounts by a US-based fraudster who exploited temporary changes to healthcare provision during the Covid pandemic has been returned to the American Department of Justice.

• In April 2022, Gustavo Geraldes was convicted of conspiracy to offer and pay healthcare kickbacks after running a scheme in which telemedicine providers authorised medically unnecessary genetic testing to be performed at laboratories part-owned by him.

• The scheme exploited temporary changes to health restrictions enacted during the Covid pandemic, which were intended to make it easier for Medicare patients to receive medical care at home. Medicare is a US healthcare program that provides free or low-cost healthcare benefits to many Americans, including the elderly, the blind, and the disabled.

• US authorities later learned that Mr Geraldes had transferred money to a Jersey bank account after a $2,645,891.55 forfeiture order was imposed.

• In total, $667,000 in confiscated funds was transferred from Jersey to the USA.

• The US authorities sought the Attorney General’s assistance in obtaining a saisie judiciaire over the money in Jersey and the registration and enforcement of the US Order.

• Attorney General Matthew Jowitt KC said: “The Mutual Legal Assistance Team in the Law Officers’ Department has worked closely with the US Department of Justice in this case involving a large-scale healthcare fraud. The case is a further example of the highly effective working relationship between the two jurisdictions in fulfilling the purpose of the confiscation regime.”

Sources

• https://www.bailiwickexpress.com/news/us-covid-fraudsters-money-returned-to-victims/

• https://www.bbc.co.uk/news/articles/c623xrv9v1j7o

• https://www.pacermonitor.com/public/case/44473184/USA_v_Geraldes

• https://www.bailiwickexpress.com/news/us-covid-fraudsters-money-returned-to-victims/