A former Stifel, Wells Fargo and Morgan Stanley advisor was sentenced Tuesday to three years and four months in prison for 11 counts of defrauding public health insurance plans out of more than $4 million and transacting in the criminal proceeds, U.S. Attorney Philip R. Sellinger announced.
Kaival Patel, 55, of West New York, New Jersey, was convicted on Dec. 7 of one count of conspiracy to commit wire fraud and health care fraud, four counts of health care fraud, one count of conspiracy to commit money laundering, and five counts of money laundering, the DOJ announced.
U.S. District Judge Edward Kiel imposed the sentence Tuesday in Camden federal court.
Patel was accused of working with a physician and others to defraud state and local public employee health plans in New Jersey. Patel created and operated a company called ABC Healthy Living LLC to market compound prescription medications, according to the Department of Justice.
“Patel and his conspirators learned that certain state and local government employees had insurance that would reimburse up to thousands of dollars for a one-month supply of certain compound medications such as vitamins, scar creams, pain creams, libido creams, and acid reflux medications,” the DOJ said Tuesday.
Patel and a conspirator “approached Patel’s family member, a medical doctor who owns and operates a clinic in Newark, New Jersey, and convinced him to authorize prescriptions for the compound medications for patients who had no medical need for the prescriptions,” the complaint said.
Patel received commissions for the compound medication prescriptions.
