A Baltimore, Maryland doctor licensed in several states, will be spending the next three years behind bars for writing and referring compounded drug prescriptions in return for illegal kickbacks.
Dr. Thomas Raley, Jr., 53, specialized in orthopedic and spine surgery and provided patients with pain management services in Virginia, Maryland and other states since 1998. The government alleged that in 2013 he and Seth Michael Myers, 53, of Crystal Lake, Illinois, began soliciting pharmacists to pay them kickbacks in return for having Raley refer expensive compounded medications to the pharmacies. His first arrangement was with Michael Beatty, 53, of Finksburg, Maryland, a licensed pharmacist.
Finding that arrangement not lucrative enough, the government alleged Raley decided to pursue another more lucrative arrangement with Mohamed Abdalla, 48, of Allendale, New Jersey, who owned multiple pharmacies. As part of that arrangement, Raley agreed to refer expensive compounded medications to Abdalla’s pharmacies in return for 80 percent of the profit. Within 18 months, Abdalla paid Raley approximately $2.5 million in illegal kickbacks.
This wasn’t the only scheme Abdalla is alleged to have participated in. He and employees at his pharmacies conspired to defraud federal, state, and private healthcare benefit programs by engaging in numerous other schemes, including billing for prescriptions in the names of themselves, family members, and other pharmacy employees that were not medically necessary and/or not prescribed by a licensed physician, and billing for prescriptions for pharmacy customers that were never filled. These additional schemes resulted in a loss to these health care benefit programs of approximately $6.2 million.
Previously, Myers was sentenced to two years in prison and Beatty was sentenced to one year and one day in prison. Abdalla was sentenced to four years in prison.
As part of his scheme, Raley used the kickback money to fund his and his family’s lifestyle. For example, he directed Myers to make his wife a salaried employee of the company that was setup to collect the illegal kickback payments. She was paid $200,000 and the company also used the illegal proceeds to pay for the lease of her Mercedes. Raley also directed Myers to have the company write him a $280,000 check, which purported to be a loan—but was never repaid— so that Raley could purchase a building in Baltimore. Finally, illegal kickback proceeds also were used to pay tuition at his children’s private school.
In a parallel civil resolution, Raley and Advanced Spine and Pain, PLLC, which he owned at the time, jointly paid $3.1 million to settle civil claims under the False Claims Act, the Virginia Fraud Against Taxpayers Act, and common law remedies.
The Health Law Offices of Anthony C. Vitale has been representing clients under investigation for more than three decades. Our firm represents clients under investigation by a wide range of state and federal agencies including the FBI, Drug Enforcement Administration, U.S. Attorney’s Office, Attorney General’s Office, State Attorney’s Office, Medicaid Fraud Control Unit, Medicare Fraud Task Force, as well as licensing boards and other enforcement agencies. Give us a call at 305-358-4500 or email us at email email@example.com.