Thursday, March 15, 2012

Insurance Fraud & Kickback Case: Capper Accused of Paying People in Sober Living Houses For Insurance Information Pleaded Guilty In Los Angeles to Insurance Fraud

A recent case shows the interplay between the buying of insurance information from low income or government insured people (Medi-Cal and Medicare cards) and using that information to obtain prescriptions for opiate drugs. This case illustrates how this type of insurance fraud turns into selling prescription opiate drugs on the black market or street.

On February 24, 2012, George Randolph, 63, of Los Angeles, pleaded guilty to one count of felony insurance fraud. Mr. Randolph was arrested in November 2011 and was accused of being a “capper” or marketer. It was alleged that he recruited people from sober living houses – offering participants $50 for their insurance information for the purpose of seeking fraudulent prescriptions of opiate pills.  Mr. Randolph entered into a plea agreement in lieu of trial. 

It was alleged that Mr. Randolph recruited people from substance abuse sober living halfway houses by offering them $50 for their Medi-Cal and Medicare insurance information. With this information, he obtained fraudulent prescriptions for oxymorfone narcotic opiate pills with a street value of $60 per pill. Mr. Randolph was in possession of the illegal pills and a counterfeit prescription when he was arrested on November 16, 2011. 

Los Angeles Superior Court Judge David Horwitz immediately sentenced the defendant to four years in state prison. This was the term agreed upon in the plea agreement. It was a high sentence because Mr. Randolph had two prior felony robbery counts. The case was investigated by the California Department of Health Services. The prosecution was by the Healthcare Fraud Division of the District Attorney's Office.

Attorney Comments: A case like this can lead to other criminal cases. For example, how did Mr. Randolph use the Medi-Cal card and insurance information to obtain a prescription from a physician? How did Mr. Randolph decide what pharmacy to use? Often physicians and pharmacies can get caught up in these cases and they both need to be aware of the fraud in the community and to have safeguards and controls to eliminate the risk of fraud in their practices. Moreover, if there are government requests for interviews or documents, it is critical that there be representation by counsel in order to determine whether you or someone in your office are considered a potential target of the investigation.  

Posted by Tracy Green, Esq. Please email Ms. Green at or call her at 213-233-2260 to schedule a complimentary 30-minute consultation. Any questions or comments  should be directed to Tracy Green, a very experienced insurance fraud attorney and kickback attorney. 

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers in criminal matters in California and throughout the country. Their website is:


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