Georgia Laboratory Owner Pleads Guilty to Felony Charge and Agrees to Pay $14.3 Million to Resolve False Claims Act Allegations

Appellate Courts
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Ryan K. Buchanan U.S. Attorney | US Attorney's office Northern District of Georgia

Andrew “Drew” Maloney, the owner of Capstone Diagnostics in Georgia, has pleaded guilty to a criminal information for conspiracy to pay health care kickbacks. As part of a global settlement, Maloney and Capstone have agreed to pay $14.3 million to resolve allegations of violating the Anti-Kickback Statute by paying commissions for unnecessary medical tests. Principal Deputy Assistant Attorney General Brian M. Boynton emphasized that such payments can undermine the integrity of federal health care programs.

U.S. Attorney Ryan K. Buchanan expressed commitment to prosecuting those who defraud government programs, stating, "We are committed to aggressively investigating and prosecuting those who defraud valuable government programs designed to benefit our most vulnerable citizens." Keri Farley, Special Agent in Charge of FBI Atlanta, highlighted the importance of ensuring that healthcare services are based on clinical needs rather than financial gain.

According to Special Agent Tamala E. Miles of the U.S. Department of Health and Human Services, Office of Inspector General, individuals who submit claims for medically unnecessary services pose a significant risk to government programs and patients. Special Agent-in-Charge Darrin K. Jones from the Department of Defense Office of Inspector General emphasized the importance of trust in federal health care programs and vowed to hold accountable those who illegally profit from them.

The case involves a scheme where Capstone entered into an arrangement with a program called Do It 4 the Hood, resulting in fraudulent drug testing claims submitted to Medicaid. Several individuals, including Dr. Duriel Gray, Bree’Anna Harris, Glenn Pair, and Rachel Sheats, have pleaded guilty in connection with the scheme. Maloney and Capstone have also entered into a civil settlement agreement to pay $14.3 million to resolve false claims to government health care programs, including profiting from the COVID-19 pandemic through unnecessary medical tests.

The civil settlement includes a recovery for state Medicaid programs and resolves a whistleblower lawsuit under the False Claims Act. Maloney’s sentencing is scheduled for May 29, 2024. The case is being investigated by multiple agencies, including the FBI and the U.S. Department of Health and Human Services-OIG. The Attorney General established the COVID-19 Fraud Enforcement Task Force to combat pandemic-related fraud.

The False Claims Act is highlighted as a powerful tool in combating health care fraud. Tips and complaints about potential fraud can be reported to the Department of Health and Human Services. For further information, individuals can contact the U.S. Attorney’s Public Affairs Office.