LawFuel.com – IRS & Attorney News
Los Angeles – On December 14, 2009, in United States District Court in Los Angeles before the Honorable Judge S. James Otero, the president and part owner of ABC Diagnostic Services, Inc. (ABC) was sentenced to five years probation, with the first year to be served in home confinement for subscribing to a false corporate income tax return for the 2004 tax year in a straw-ownership scheme related to Medicare fraud.
Linda Wilson, 60, of Long Beach, admitted in her plea agreement that she was president and part owner of ABC Diagnostic Services, Inc. (ABC) in partnership with others who came under investigation for Medicare fraud.
In 2003, Wilson filed a false Medicare enrollment application for ABC in that she provided false statements about her 5% or more sole ownership interest in ABC to Medicare and failed to disclose that she shared ownership interest with others, including Konstantin Grigoryan.
The following year, Wilson again did not disclose her shared ownership with Grigoryan in ABC to Medicare. Because of the continued concealment of Grigoryan’s true ownership interest from Medicare, ABC falsely received reimbursement benefit for services rendered to Medicare beneficiaries.
In 2003, Grigoryan was arrested for Medicare fraud, causing Medicare to pay out fraudulent claims for reimbursement to various other Medicare providers.
According to Wilson’s plea agreement, she filed a false corporate income tax return (Form 1120S) for ABC for tax year 2004, and stated that there was $37,060 in ABC shareholders’ income and that ABC paid $619,075 in “professional fees” as deductible business expenses. In truth, the shareholders’ income figure was false and understated and the “professional fees” figure was false and overstated
The shareholders’ income falsely did not include the amounts paid as for the benefit of the other part-owners in ABC, and the “professional fees” amount falsely included these amounts.
Between 2004 and 2005, Wilson received approximately $290,927 in profits from the operation of ABC, which resulted from Wilson’s fraudulent enrollment of ABC as a Medicare provider.
The investigation and prosecution of Wilson was conducted by IRS – Criminal Investigation, the Federal Bureau of Investigation, and the United States Attorney’s Office’s in Los Angeles.