MIAMI — Elizabeth Peters Young, 55, of Ball Ground Georgia, was sentenced to 57 months in prison, to be followed by three years of supervised release, in connection with her role in a lengthy conspiracy to pay and receive illegal kickbacks in exchange for the referral of expensive pain cream prescriptions to a Federal Worker’s Compensation program designed to provide benefits to federal employees injured while on the job. In addition, Young was ordered to pay a special assessment, forfeiture, and restitution, with the amounts to be determined at a future hearing.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, Rafiq Ahmad, Special Agent in Charge, U.S. Department of Labor Office of Inspector General (DOL-OIG), and Scott Pierce, Special Agent in Charge, United States Postal Service Office of Inspector General (USPS-OIG) made the announcement.
District Court Judge Rodolfo A. Ruiz imposed the sentence, which came after a Fort Lauderdale jury found Young guilty on December 19, 2019 of conspiracy to pay and receive healthcare kickbacks and four counts of paying kickbacks in connection with a federal healthcare program (Case No. 19-CR-60157-RAR). During the ten-day trial, the evidence showed that in 2015, Young, a wealthy medical device sales rep and business owner who had been in the industry for decades, learned that the trust-based Federal Worker’s Compensation would reimburse thousands of dollars for certain “prescription” pain creams and patches called Terocin and Lidopro. In reality, these pain creams and patches were nearly identical to widely available over the counter items like Icy Hot.
According to court documents and evidence presented at trial, from March 2015 through April 2018, Young capitalized on her knowledge of these reimbursement rates by creating and executing an illegal kickback scheme. First, she made a deal with two pharmacies, including a small pharmacy in a strip mall to split 50% of illegal profits for the sale of these high-priced creams and patches. Young then used her friend who was a medical assistant to a spinal surgeon to prescribe these creams and patches to Federal Worker’s Compensation patients and then send those prescriptions to the two pharmacies. By simply connecting the prescriptions to the pharmacies, Young received over $1.5 million in fraudulently obtained federal funds.
The problem was that the medical assistant writing the scripts for Young during the scheme was not doing so for free, and as Young knew, it is illegal to pay someone in a doctor’s office to refer prescriptions. Therefore, to conceal the scheme, Young hired the medical assistant’s boyfriend as her “rep” to supposedly pitch the patches and creams to the very spinal surgeon that his girlfriend worked for in exchange for “commissions.” The evidence at trial proved that in reality, the boyfriend, who worked at Home Depot and had recently suffered brain injuries from a car accident, was expected to just “sit back and collect.” Young then proceeded to pay the boyfriend over $300,000 in illegal kickbacks to do just that.
Evidence at trial showed that during the scheme, Young was keenly aware of the nature of her unlawful conduct, and went to great lengths to disguise such conduct from authorities. For example, Young not only repeatedly googled articles about topics such as fraud and kickbacks at pharmacies, the FBI, and doctors being arrested, she also emailed them to co-conspirators with subject lines such as “FBI, Scary.” She also instructed co-conspirators to open shell companies, remove names from bank accounts, and not discuss patches and creams with others in the industry.
U.S. Attorney Fajardo Orshan commended the investigative efforts of the DOL-OIG and USPS-OIG. The case was prosecuted by Assistant U.S. Attorneys Anne P. McNamara and David Turken. AUSA Adrienne Rosen handled asset forfeiture.