Two Florida men are facing federal charges in a sprawling $25 million health care fraud operation that weaponized telemedicine and shell companies to bleed Medicare, TRICARE, and CHAMPVA dry. Thomas Farese, 79, of Delray Beach, and Domenic J. Gatto Jr., 47, of Palm Beach Gardens, were named in an 11-count indictment unsealed in Newark, N.J., detailing years of conspiracy, wire fraud, and illegal kickback deals disguised as medical services.
The scheme revolved around durable medical equipment (DME), primarily orthotic braces, prescribed without medical necessity. Farese and Gatto, according to court documents, controlled multiple DME companies while hiding behind straw owners falsely listed as proprietors to Medicare. They paid and received kickbacks for doctor-signed orders generated through telemedicine outfits that rubber-stamped prescriptions sight unseen. The fraudulent claims were then billed directly to federal health programs, racking up tens of millions in false charges.
Gatto didn’t stop at braces. He brokered a parallel kickback network tied to compounded medications—custom drug mixes often exploited in fraud schemes. Suppliers paid him for patient referrals, and pharmacies tied to Gatto’s operation paid him kickbacks for each prescription filled. These were not legitimate medical transactions; they were profit pipelines. The drugs were billed to Medicare regardless of need, stacking losses that federal investigators now peg at approximately $25 million.
Money laundering was baked into the operation. Gatto and his co-conspirators cycled illicit proceeds through layers of bank accounts under their control, shielding the origin of the cash. The indictment charges both men with conspiracy to transact in criminal proceeds—a nod to the calculated effort to clean dirty health care dollars. The use of false ownership records and third-party fronts underscores the sophistication of the fraud.
Charges against Farese and Gatto Jr. include conspiracy to commit wire fraud—carrying a maximum 20-year sentence—alongside multiple counts of health care fraud, each punishable by up to 10 years. Conspiracy to violate the Anti-Kickback Statute brings a five-year max. Fines could hit $250,000 per count, or twice the gross gain from the offense, whichever is greater. The full weight of federal prosecution is now bearing down.
The investigation was a multi-agency takedown led by the FBI, Department of Health and Human Services-Office of Inspector General, Defense Criminal Investigative Service, and the U.S. Department of Veterans Affairs Office of Inspector General. Assistant U.S. Attorneys Sean M. Sherman, Ryan L. O’Neill, and Senior Trial Counsel Barbara Ward are prosecuting the case. Acting U.S. Attorney Rachael A. Honig called the fraud ‘a betrayal of taxpayer-funded programs meant to serve the sick and vulnerable.’
Related Federal Cases
- Farese and Gatto Face Multimillion-Dollar Health Care Fraud Charges · New Jersey
- Eduardo Arango Chong Charged in $6M Health Care Fraud Scheme · New Jersey
- Florida Man Sentenced 96 Months for $11M Health Care Kickback Scheme · New Jersey
- Coral Springs Scammer Sentenced for $11M Health Care Kickback Scheme · New Jersey
- NJ Doctor Vincent J. Gamuzza Indicted in $250K Health Care Fraud · Pennsylvania
Key Facts
- State: New Jersey
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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