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South Gate Businessman Pleads Guilty to Health Care Fraud Scheme, Tax Evasion
LOS ANGELES – Joseph Tusia, 60, of Leominster, Massachusetts, has pleaded guilty to federal criminal charges for recruiting paraplegics in a health care fraud scheme that netted more than $1.7 million and for cheating on his taxes.
According to his plea agreement, Tusia operated a laser tattoo removal business in South Gate and 10 durable medical equipment supply companies in California, Nevada, and Massachusetts. Tusia controlled the tattoo removal companies and the DMEs but intentionally withheld his name from bank accounts and state registrations to evade tax liability.
Tusia and a co-schemer submitted an application to Anthem Blue Cross for a small group health insurance plan on December 30, 2015. Despite the eligibility requirements, Tusia caused to be submitted to Anthem the names of nine individuals purported to be full-time employees of Tattoo Removal and a person who was a dependent of the Tusia. None of these purported employees were employed by Tattoo Removal or eligible for health insurance coverage under Tattoo Removal’s plan with Anthem.
Tusia identified the Purported Tattoo Removal Employees from his friends and associates who were paraplegic and required medical supplies, knowing and expecting that the Purported Tattoo Removal Employees would purchase their medical supplies from the DMEs that were controlled by Tusia and his associates.
From March 2016 to June 2020, Tusia and his co-schemers submitted fraudulent claims to Anthem on behalf of the DMEs for medical supplies provided to the purported employees, knowing that none of them were eligible for coverage. As a result of these fraudulent claims, Anthem paid the DMEs controlled by Tusia approximately $1,731,215.
Tusia also admitted in his plea agreement to knowingly and willfully failing to report income he received from the DMEs in tax years 2017 through 2020, totaling more than $1,573,644. Tusia admitted that he failed to pay tax to the IRS and that he took affirmative steps to evade paying taxes, such as by creating the DMEs and opening bank accounts for the DMEs in the names of his associates and co-schemers.
United States District Judge George Wu has scheduled a December 5 sentencing hearing, at which time Tusia will face a statutory maximum sentence of 10 years in federal prison on the health care fraud count, and up to five years in federal prison for the tax evasion count.
The United States Department of Labor – Employee Benefits Security Administration, the FBI, and IRS Criminal Investigation are investigating this matter. Assistant United States Attorney Jeff Mitchell of the Major Frauds Section is prosecuting this case.
Key Facts
- State: California
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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