TWO DEFENDANTS CONVICTED IN NATIONAL INTERNET AND SECURITIES FRAUD SCHEME

September 29, 2006

FOR IMMEDIATE RELEASE

R. Alexander Acosta, United States Attorney for the Southern District of Florida, and Jonathan I. Solomon, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, announced today that on September 25, 2006, a jury convicted defendant Magda Luz Lavin, a former owner of at least two HIV clinics in the Southern District of Florida, on all 25 counts of a federal Indictment, charging her with conspiracy to commit health care fraud, in violation of 18 U.S.C. § 371; health care fraud, in violation of 18 U.S.C. § 1347; and money laundering, in violation of 18 U.S.C. §§ 1956 and 1957.

According to the evidence, the defendant used two medical clinics, Alternative Day Spa, Corp., formerly in Kendall, and Alternative Treatment Programs, formerly in Key West, to defraud Medicare of more than $5 million between May 2000 and December 2002. The two clinics claimed to specialize in the treatment of HIV patients with “infusion therapy treatments.” The patients who attended the clinics were, in fact, HIV positive.

Under Lavin’s direction, the clinics fraudulently billed Medicare for dosages of two expensive medications, Neupogen and Procrit. Patients received either no medications at all or minimal dosages of the medications diluted with vitamins and saline solution or dextrose solution. Lavin also payed kickbacks to patients to induce them to continue to attend the clinics.

During the trial, the evidence revealed that the defendants had caused the falsification of progress notes on “infusion therapy sheets” in the patients’ files to make it appear that the patients were receiving medications as billed to Medicare. In truth, however, patients were not receiving the medications as noted on the sheets and billed to Medicare. In addition, the government presented expert testimony that it was actually impossible for patients to receive the dosages of medications as billed to Medicare. The expert also testified that these medications were normally provided by injection, not by infusion, and that – contrary to the practice at the two clinics – Neupogen and Procrit should not be mixed together, nor with saline solution.

The trial lasted three weeks before the Honorable Judge Joan A. Lenard. On September 18, 2006, after three weeks of trial, defendant Lavin failed to appear in Court, resulting in the Court issued a bench warrant for her arrest. The Court found that Lavin had fled the jurisdiction and had voluntarily waived her appearance during the remainder of the trial, and permitted the government to proceed with the trial. On September 25, 2006, the jury returned a guilty verdict on all counts.

Judge Lenard has scheduled a sentencing hearing and will sentence the defendant in absentia if she does appear at sentencing. She faces a maximum punishment of 10 years’ imprisonment on the health care fraud charges and 20 years’ imprisonment on the money laundering counts.

On September 26, 2006, Lavin was indicted on charges of failure to appear and bond jumping. She remains a fugitive.

This investigation stemmed from another prosecution of a similar fraudulent scheme that occurred at two other HIV clinics on Miami Beach, Bolanos Institute, Inc., and Lefebvre Institute Corporation. Between February 2002 and June 2003, Bolanos Institute and Lefebvre Institute received more than $5 million in Medicare reimbursements for infusions of Neupogen and Procrit. The defendants included the two clinic owners (Leonardo Javier Bolanos and Robert Peter Sauve), three physicians employed at the clinics (Jorge Humberto Forcada, Clark Carlton Mitchell, and Jose Joaquin Vega), and other clinic employees (Alejandra Vanessa Carnaru, Joseph Shane Elliott, Rebeca Nereyda Nunez, Orlando Amigo, and Luis Mario Suarez). Bolanos and Sauve fled the country and remain fugitives. All other defendants were convicted and incarcerated.

Mr. Acosta commended the efforts of the Federal Bureau of Investigation in their investigation of cases involving purported HIV infusion clinics in the Southern District of Florida. The case against Lavin was prosecuted by Assistant United States Attorney Barbara Martinez, who along with Assistant United States Attorney Matthew Axelrod, also prosecuted the Bolanos and Lefebvre Institutes case.