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Nashville Wellness Business Founder Charged in $700,000 Ponzi Scheme
NASHVILLE, Tenn. – Howard L. Young, 75, of Nashville, was charged Friday, October 26, 2020 with operating a Ponzi scheme, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.
Young, the founder of Integrative Medical Services (IMS), a Nashville-based holistic wellness business, is accused of duping dozens of patients, financial institutions, and investors out of nearly $700,000.
The charging documents allege that in 2015, Young founded IMS, purportedly a holistic wellness business. Young also held himself out to hold a Doctor of Naturopathy, but did not hold a Medical Doctorate and did not have a medical license.
As early as 2017, Young began soliciting cancer patients, investors, and employees, telling them that he had obtained a $2 million grant from Vanderbilt University to study cancer patients and other patients with chronic medical conditions. Young claimed he was awarded this grant because he had cured himself of cancer using naturopathic methods.
In order to participate in the study, Young told patients that Vanderbilt required an up-front payment of $10,000, which would be returned to them at the conclusion of one year. Young promised patients that he would hold the initial funds withdrawn in escrow and would make all monthly payments and would pay off all existing balances at the conclusion of one year, so long as the patient continued to abide by all study protocols.
However, in fact, Vanderbilt had not awarded any grants to Young or IMS. Young’s representations that IMS had a grant from Vanderbilt were false and were intended to induce patients to apply for and obtain credit and loan accounts at Synchrony Bank, MetaBank, and Cross River Bank; to induce investors to give him funds for his fraudulent scheme; and to induce employees to help him solicit additional patients to participate in his fraudulent scheme.
Young did not hold the money in escrow as he promised and withdrew a portion of the funds for his own personal use, made payments to his personal credit cards, and made minimum payments on account holders’ credit accounts and loan accounts. Patients did not routinely receive the nutritional supplements promised by Young, nor did they receive nutrition and exercise coaching, gym memberships, massages, or acupuncture as promised.
IMS generated little, if any, revenue. The vast majority of funds flowing into IMS were deposits from the CareCredit credit accounts and the HCS loan accounts. By July 2019, Young had received a total of approximately $669,470 from CareCredit and HCS.
If convicted, Young faces up to 30 years in prison and a $1 million fine.
This case was investigated by the FBI. Assistant U.S. Attorney Kathryn W. Booth is prosecuting the case.
A criminal Information is merely an accusation. The defendant is presumed innocent until proven guilty in a court of law.
Key Facts
- State: Tennessee
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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