$40M health care claims fraud scheme: Co-owner pleads guilty

A Connecticut insurance firm owner faces up to 30 years in prison and will pay nearly $15 million in restitution and forfeit $2 million in connection with a scheme to steal a client’s health care funds, defraud lenders and use misappropriated funds to pay for personal expenses, according to a statement from the DOJ. Anthony Riccardi pleaded guilty to conspiracy to commit wire fraud and bank fraud as part of the $40 million scheme. Sentencing has been scheduled for July 20, 2023.

According to court documents, Riccardi owned 50% of Employee Benefit Solutions LLC and served as its executive vice president. The firm offered health care insurance-related services and provided third-party health care claims administration services to clients that self-insured their employee health care plans. As a TPA, EBS was supposed to earn an administrative fee to administer, process and pay health care claims for its clients.

EBS served as a TPA for a New York auto dealership’s self-funded employee health care program and administered a bank account on the dealership’s behalf for the purpose of paying employee health care claims. EBS generated bi-monthly ‘check register’ invoices for the dealership that listed all employee health care expenses from health care providers during each two-week period. The dealership then would pay the invoiced amount with the expectation that EBS would pay the claims to the health care providers.