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Medicaid fraud ring made millions by offering poor people free shoes, Brooklyn DA says

Twenty-three people were charged on March 23 in

Twenty-three people were charged on March 23 in a Medicare fraud scheme that lured thousands of low-income patients to medical clinics for unnecessary procedures. Photo Credit: iStock

Nearly two dozen people -- among them nine physicians -- were charged on Tuesday in connection with a Medicaid fraud scheme that lured thousands of low-income patients to medical clinics for unnecessary services in exchange for free shoes, Brooklyn District Attorney Ken Thompson said.

The 23 defendants named in the 199-count indictment earned nearly $7 million between October 2012 and September 2014 in the "Medicaid mill," Thompson said.

They promised free footwear to poor city residents in exchange for proof of a valid Medicaid card and agreement to submit to exams or tests, he said.

"At the heart of this health care fraud scheme was the exploitation of poor people, the most vulnerable people in our society," Thompson said during a news conference at his Brooklyn office.

"These defendants exploited poor people to make money."

The scheme operated in neighborhoods like Brownsville, Bushwick, Richmond Hill, Jamaica, and areas of the Bronx, Thompson said.

Patients were loaded into vans after being recruited from institutions like homeless shelters and welfare offices across New York City under the direction of the scheme's ringleader, Eric Vainer, Thompson said.

"The volume was his gig," he said, referring to Vainer. "The goal was to get as many people in the van as possible to get to one of these clinics. And this was done, we allege, day after day for two years."

Vainer, 43, who owned some of the clinics, was taken into custody yesterday in Florida while on vacation. He has not been arraigned and could not be reached for comment.

Thompson played an audio recording he said captured Vainer saying the key was to build up the business and then they "could use the same patients like guinea pigs for anything we want."

A videotape Thompson played showed a man he identified as the scheme's chief recruiter, Bernard Rorie, 59, of Brooklyn, announcing the footwear offer outside an East New York soup kitchen.

Prosecutors said Rorie checked potential victims' Medicaid cards to ensure they were valid.

He would then load the patients into the van and drop them at one of the clinics, prosecutors said.

Rorie was arraigned in Brooklyn yesterday morning and held in lieu of $50,000 bail.

He pleaded not guilty and his next court appearance is set for May 19.

Attorney information for Rorie was not available yesterday.

The other defendants also pleaded not guilty at their arraignments yesterday, authorities said.


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