Jacksonville pharmacy owner charged in $51M HIV drug fraud case

Overview

A Jacksonville pharmacy owner has been charged in a 31-count federal indictment with health care fraud and money laundering. Prosecutors say the claims drew about $51 million from Medicare, Medicaid and private insurers for HIV medications. A St. Johns accountant is charged in the same indictment with money laundering.

The U.S. Attorney’s Office for the Middle District of Florida announced the charges Thursday.

An arrest or charge is an accusation. Every person is presumed innocent unless and until convicted in court.

Who is charged

The office named two people in its release:

• Charlie Bernard Griffin III, 61, of Jacksonville, charged with health care fraud and money laundering.
• Ethelbert Chinenye Nwanegbo, 47, of St. Johns, charged with money laundering.

Each count carries a maximum penalty of 20 years in prison, the office said. U.S. Attorney Gregory W. Kehoe announced the case.

What the indictment says

According to the indictment, Griffin owned First Coast Community Development, which ran a pharmacy in Jacksonville. Prosecutors say he made an agreement with a marketing company that referred people to the pharmacy for HIV post-exposure prophylactic medications.

The marketing company’s representatives set up tents and tables in Jacksonville, generally in low-income areas, the release said. They offered free, government-sponsored cellphones to anyone who stopped and gave identifying information. While taking those details, they also collected health insurance information, including whether the person had Medicare, Medicaid or private coverage.

Under the agreement, the pharmacy paid the marketing company $200 for each person referred for HIV medications, but only if an insurer paid the claim. The company paid its representatives, usually $50 a person, on the same condition. Prosecutors said a per-referral payment that depends on a claim being paid is an illegal kickback.

The indictment says the pharmacy then:

• generated prescriptions for HIV medications that a nurse practitioner authorized without ever seeing, speaking with or examining the patients
• used a diagnosis code saying each person had, or had been exposed to, HIV or a sexually transmitted disease, a diagnosis prosecutors call false
• filled the prescriptions and billed Medicare, Medicaid or private insurers

Tens of thousands of fraudulent claims were submitted, the office said, and reimbursements totaled about $51 million. Prosecutors say Griffin received about $14 million.

Three others, the marketing company’s owner, the pharmacy’s pharmacist and the nurse practitioner, were charged separately and each agreed to plead guilty, according to the release.

The accountant’s alleged role

Nwanegbo was an accountant in Jacksonville, the office said. Prosecutors say Griffin and a co-conspirator moved fraud proceeds into accounts Nwanegbo controlled. He then returned the money through other accounts and in cash, keeping a fee of about 10%, according to the indictment.

What the government wants to recover

The indictment seeks forfeiture from Griffin of:

• $14,245,474, which prosecutors call his proceeds from the fraud
• $17,807,628.14, the property involved in the money laundering counts
• $8,182,800.17 already seized from his bank accounts
• three real properties and four vehicles prosecutors say he bought with fraud proceeds

From Nwanegbo, it seeks $6,068,540.50, the property involved in the money laundering counts against him.

The U.S. Department of Health and Human Services Office of Inspector General and the FBI investigated the case.

What it means for you

If you gave your details at a free-phone table in Jacksonville and later received HIV medication you never asked for, or saw a pharmacy claim you do not recognize on a Medicare or Medicaid statement, you can report it to the HHS Office of Inspector General hotline.

Named in this story and later cleared? See our removal and correction policy.