Kevin B. Lake, 50, of New Albany, Ohio, has pleaded guilty to running a South Side medical center as a drug premises and evading more than $3.5 million in taxes, according to court documents.
Kevin B. Lake, the owner and operator of Columbus Southern Medical Center, pleaded guilty to drug, tax, and fraud charges in a plea agreement that also includes the forfeiture of remaining funds from the clinic’s illegal activities.
According to court documents, Lake owned and managed Columbus Southern Medical Center through one or more corporate or trust entities, which he used to insulate himself from the illegal drug trafficking being conducted at the clinic.
Between 2006 and 2013, Lake admitted that he knew doctors and staff at the 2912 South High Street clinic prescribed controlled substances to patients without a legitimate medical purpose. During that time, hundreds of patients showed up daily – 85 percent of whom were returning patients – to receive prescriptions of oxycodone, hydrocodone, and Xanax. The percentage of patients who were prescribed these controlled substances rose each year, jumping from nearly 60 percent in 2004 to nearly 92 percent in 2009 and 2010.
Lake agreed to plead guilty to maintaining the clinic as a drug premises. He also admitted that he exclusively controlled all of the proceeds generated by the illegal activity being conducted by the doctors, physician assistants, and staff at the clinic, which was more than $38 million in payments for patient visits. He admitted to engaging in more than $20 million in money laundering transactions with these illegal drug proceeds.
Lake’s tax crimes caused a tax loss of more than $3.5 million, and he admitted causing the filing of corporate tax returns that falsely claimed inflated depreciation deductions for nearly $7.4 million in so-called ‘equipment’ purchases by his corporations from his trust for tax years 2005 through 2011. He also admitted to falsely reporting these purchases as capital gains on his trust tax returns rather than as ordinary income, thereby securing a much lower tax rate.
As part of the plea agreement, Lake agreed to forfeit the remaining funds from the clinic’s illegal activities, after restitution is paid from the funds. He also faces significant prison time and fines for his crimes.
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Key Facts
- State: Federal
- Category: Drug Trafficking|Fraud & Financial Crimes|Violent Crime
- Source: DOJ Press Release â†â€â€
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