The money laundering arose from admissions by the doctor that the cash he received for seeing patients for narcotics prescriptions ($554,070) was deposited into his personal bank accounts instead of his business accounts. The plea agreement also involves Dr. Sun stipulating to forfeit $342,000 seized from his accounts and agreeing to pay the California Medical Board’s investigation fees of $86,975 as restitution.
The Indictment was filed on March 18, 2014 and the case is pending before Hon. Manuel Real in the Central District. A change of plea hearing is set for June 26, 2014. As part of his plea agreement, Dr. Sun has agreed that as a condition of his supervised release he will no longer write prescriptions or dispense controlled substances, and will not oppose any administrative action by the DEA or Medical Board to suspend or revoke his licenses or registrations.
This case arose out of an undercover investigation where 12 undercover officers sought prescriptions for controlled substances from Dr. Sun in 2011 and 2012. Dr. Sun agreed to plead guilty to distributing hydrocodone, and also admitted in his plea agreement that he also illegally prescribed and distributed other controlled substances (Xanax and Soma). Sun admits that he prescribed these drugs from the beginning on 2011 through June 2012 and that he did so “outside the usual course of professional practice and without a legitimate medical purpose.”
Dr. Sun admitted that, between January 2011 and May 2012, he received approximately $554,070 in cash payments from patients, which he deposited into a personal account “for the purpose of disguising the source and nature of the funds, and which represented the proceeds from defendant’s issuance of prescriptions for controlled substances.”
The drug trafficking count (18 U.S.C. § 841(a) carries a statutory maximum penalty of 10 years in federal prison, and the money laundering count (18 U.S.C. §1956(a)(1)(B)(i) carries a maximum penalty of 20 years in custody. The plea agreement seems to contemplate a sentence on the low end of the guidelines, and the defense waived any right of appeal if the sentence is 3 years or less. Similarly, the U.S. Attorney’s Office agrees not to appeal the sentence if the sentence is no less than 3 years.
This case shows that older or impaired physicians are more likely to be involved in criminal cases such as this one. This physician is 78 and under the terms of the plea agreement, he is likely to get federal prison time. The plea agreement allowed him a downward departure of two levels due to his age. However, this was offset by an abuse of trust enhancement of two levels.
The current wave of indictments and charges against physicians for prescribing controlled substances will be unlikely to continue as physicians are more aware of the requirement that prescriptions be issued with legitimate medical purpose. However, there are numerous investigations that are outstanding and the Medical Board, District Attorney’s Office and U.S. Attorneys’ Office will continue to be vigilant.
Undercover cases are difficult given that the evidence is preserved on what the patients said and the physician’s response to the patients. With 12 visits, it establishes a record that impeaches the physician and undermines his credibility. Dr. Sun had a practice and saw the patients but the issue of whether there was legitimate medical purpose would be an issue of expert opinion.
Any physician prescribing controlled substances must be compliant with pain management protocols, Medical Board rules and seek outside advice to ensure that they will not face criminal or disciplinary charges by the Medical Board or DEA.
Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law