Undercover Ops Attack Calif. Med-Legal Mills

June 10, 2003

Six people suspected of participating in medical-legal mills in the Sacramento area have been arrested after a two-year undercover investigation by the California Department of Insurance (CDI) Fraud Division, Sacramento County District Attorney’s Office, the California Highway Patrol, the Federal Bureau of Investigation, the Livermore Police Department, Santa Ana Police Department, Irvine Police Department and the National Insurance Crime Bureau.

Arrested were chiropractor Dennis Nguyen, 33, of Elk Grove, for conspiracy and insurance fraud; chiropractor Phillip Wesley Cazel, 40, of Newcastle, for conspiracy and insurance fraud; Cyndi Nguyen, 28, of Elk Grove, for conspiracy; John Tran, 53, of Sacramento, on two felony counts of processing claims for rebate or compensation and insurance fraud; Quincy Tran, 46, of Elk Grove, for conspiracy and insurance fraud, and Hoa Vo AKA Lezlie Nguyen, 42, of Sacramento, for conspiracy. If convicted, each could face up to five years in prison and/or a fine of $50,000. Bail was set at $15,000 each.

CDI’s Organized Auto Insurance Fraud Task Force initiated the arrests and also conducted 11 search warrants of law offices and chiropractic clinics.

Med-Legal mills occur when attorneys and medical providers collude to illegally refer patients to each other for auto insurance and workers’ compensation kickbacks. In this case, CDI undercover officers were introduced as patients who had been involved in auto collisions. They were then referred to one of the chiropractors for treatment. The chiropractor allegedly billed the undercover officers’ insurance companies for treatments they did not receive. Once the “treatment” was completed, the chiropractor allegedly referred the officers to legal advocates for representation. Undercover officers admitted to the legal advocate that they did not receive all treatments billed to the insurance company, but according to investigators the legal advocates directed the officers to agree to report that they had received a combined $24,000 in medical treatments.

The Sacramento County District Attorney’s Office is prosecuting the case.

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