Manhattan Pharmacy Owner Admits To $1 Million "phantom Drug" Scam
Attorney General Spitzer today announced that a midtown Manhattan pharmacy owner has admitted to stealing $1,078,634 from taxpayers by fraudulently billing the State Medicaid program for thousands of expensive prescriptions that were never dispensed to patients - or even in stock.
Appearing yesterday afternoon in Manhattan Supreme Court before Justice John Bradley, Rami Waisman and his corporation, Halmor Trading Corp., pleaded guilty to Grand Larceny in the Third Degree and Offering a False Instrument for Filing in the First Degree.
Sentencing was set for February 13, 2001, at which time Justice Bradley indicated he would order Waisman to make full restitution as part of his sentence.
"For ten years, the defendant's pharmacy did very little Medicaid business. Then suddenly, in 1995, the company's billings dramatically jumped to over $300,000 before skyrocketing to nearly $1 million in 1996, its last year of operation. In fact, the vast majority of its claims for dozens of costly brand name drugs were bogus," said Spitzer.
"My office will continue to aggressively pursue and prosecute those individuals who abuse the Medicaid program and steal from the taxpayers of this State."
Waisman, 52, of 69 Stepney Street on Staten Island, owned Halmor Trading Corp., which formerly did business as Kips Bay Super Drugs at 363 Third Avenue. Medicaid billings to the corporation totaled $327,442 in 1995 and $975,349 in 1996.
The illegal billings took place between January 1995 and November 1996. Among the drugs improperly billed for were Diflucan, Mevacor, Prozac, Xanax, Buspar, Paxil, Zoloft, Augmentin, and Procardia.
The case was prosecuted by Special Assistant Attorney General Robert J. Goldstein, of the New York City Regional Office of Spitzer's Medicaid Fraud Control Unit. All cases are handled under the direct supervision of Deputy Attorney General Jos? Maldonado.