The U.S. Attorney’s Office for the Southern District of Florida announced the arrest of a Coconut Creek man accused of using his businesses to fraudulently obtain federal loans meant for small businesses affected by the coronavirus (COVID-19) pandemic and bilking the Medicare system of at least $5 million.
Carlos Belone, 37, was arrested Friday and charged with wire fraud, payment of health care kickbacks, conspiracy to commit health care fraud, and making false statements to a financial institution. His bond was set at $150,000. It is unclear if he has acquired legal representation.
According to the criminal complaint, the accused is the owner of a durable medical equipment company in Coral Springs called R&S Pharmacy Inc. He is accused of applying for several loans through the Small Business Administration’s Payroll Protection Program (PPP) using falsified tax documents and phony profit and loss statements.
The PPP is a federal initiative that was designed to provide funding for job retention and other business-related expenses to small American businesses affected by the coronavirus pandemic. It allows qualifying small businesses to receive two-year loans with a one percent interest rate. Over $650 billion in forgivable loans were authorized by Congress as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March 2020.
The accused reportedly received over $22,000 in loans and immediately transferred $12,000 to a bank account under his personal control. He used the rest of the money to further a Medicare fraud scheme he was running through his businesses. The complaint claims he submitted false and fraudulent claims to Medicare for orthotic braces that were medically unnecessary. Patients interviewed by investigators allegedly stated that they did not need or want braces and had not authorized their Medicare number to be used by the defendant’s pharmacy to submit claims for the devices. Several patients also stated that they did not receive the braces as represented in the claims the defendant purportedly submitted to Medicare.
Investigators also interviewed the doctors who prescribed the medical equipment in the claims. The doctors allegedly admitted they wrote the prescriptions for orthotic braces in exchange for kickbacks. One doctor said the defendant paid him between $150 and $325 per prescription depending on the type of braces noted in the order, the complaint alleges.
In total, R&S Pharmacy’s claims totaled more than $5 million between May 2018 and December 2019. He allegedly submitted similar fraudulent claims through another company, R&S DME Services LLC, between July 2019 and January 2020. Those claims totaled more than $680,000, the complaint states. He continued the alleged scheme in April 2020, after he received his PPP loan proceeds.
The defendant’s case was investigated by the Health and Human Services Office of the Inspector General in conjunction with the FBI. The press release announcing his charges noted that a criminal complaint is only an allegation and that a defendant is presumed innocent until proven guilty.
Fraud is one of the most commonly prosecuted crimes in South Florida. Any business owner accused of committing fraud should immediately consult an experienced attorney who can review the evidence and build a strong defense.
South Florida Fraud Defense Attorney