The scheme was easy, federal prosecutors stated.
Scott Raffa wanted to fill his Orange County rehabilitation facilities with individuals battling dependancy so he might gather from the sufferers’ insurers for weeks or months at a time. “Physique brokers” helped him discover the sufferers. In change, he paid them handsomely — to the tune of $174,600 over a 12 months and a half — prosecutors alleged.
Raffa runs three Orange County sober dwelling services — Sober Companions Waterfront Restoration Middle, Sober Companions Reef Home and Sober Companions Seaside Home.
The houses targeted on “enjoyable” for recovering drug and alcohol customers.
“Make no mistake, left un-treated Alcohol and Drug Habit is a life threatening illness and we consider that with a purpose to ‘present’ our purchasers that life is best Sober, a little bit Solar and Enjoyable doesn’t harm,” Raffa’s firm wrote on its web site. “A key to Sober Associate’s Philosophy is to show how Sobriety might be enjoyable or our purchasers received’t discover worth within the work it takes to remain Sober. We insist on having enjoyable with our purchasers.”
However behind the scenes, Raffa sought to verify he was filling his properties with well-insured purchasers.
Prosecutors alleged that he entered into “sham” contracts with so-called physique brokers, who would discover new sufferers for his companies. He would pay the physique brokers primarily based on the possible affected person’s insurance coverage and the size of time they had been anticipated to remain within the rehab middle, in line with the indictment.
If the affected person didn’t keep a minimum of three weeks, Raffa refused to pay, the federal authorities stated.
Raffa made 12 unlawful kickbacks over the 12 months and a half throughout which he was working the scheme, prosecutors alleged. Funds of as much as $34,600 went to 2 completely different companies, in line with the indictment.
Physique brokers typically promise potential sufferers cash — from a whole bunch of {dollars} to some thousand — to examine into the rehabs they’ve chosen, an FBI agent who investigates them defined in a separate court docket case. Generally, the promised pay causes substance customers to examine into rehab even when they haven’t any want to get clear. The system of utilizing physique brokers is so widespread that reputable services that don’t pay the brokers have needed to shut because of lack of sufferers, the agent, Kathleen Kennedy, stated in court docket paperwork.
A grand jury indicted Raffa on April 10 and he was arrested Saturday. He pleaded not responsible Monday.
Federal prosecutors declared Orange County the epicenter of dependancy trade fraud in 2021, when the Division of Justice promised a crackdown on dangerous actors within the house.
Prosecutors stated the schemes assigned a worth to sufferers primarily based on their insurance coverage and sometimes positioned victims in a cycle of rehabilitation and relapse.
