California Man Admits Role In $10 Million Health Care Kickback Scheme

NEWARK, N.J. - A California man today admitted his role in a kickback scheme that caused more than $10 million in losses to Medicare, Attorney for the United States Vikas Khanna announced.

Adam Wayne Owens, 44, of Riverside, California, pleaded guilty before U.S. District Judge Michael E. Farbiarz in Newark to one count of a superseding indictment charging him with conspiracy to violate the federal Anti-Kickback Statute.

According to documents filed in the case and statements made in court:

From November 2018 to January 2020, Owens participated in a kickback and bribery scheme with testing companies that arranged for at-home cancer genetic tests (CGX). Owens owned and controlled marketing companies in California through which he and his conspirators identified Medicare beneficiaries to target for CGX testing. Owens and his conspirators provided personal and medical information about the Medicare beneficiaries to the testing companies, which caused CGX testing kits to be sent to the beneficiaries. Once the CGX tests were completed and returned, Owens' conspirators submitted claims for reimbursement to Medicare. Owens' companies received kickback payments ranging from $1,700 to $2,000 for each CGX test resulting in Medicare reimbursement.

To conceal the scheme, the testing companies wired various kickback payments to a company in New Zealand, which then wired the payments to bank accounts controlled by Owens in the United States. To further conceal the scheme, Owens entered into a sham contract with the New Zealand company which made it appear that one of Owens' marketing companies was engaged in and being paid for legitimate marketing and referral services by the New Zealand company. Owens then generated invoices falsely purporting that the marketing company was providing hourly referral services for the New Zealand company. Instead, Owens received payments from the New Zealand company based solely on the number of CGX tests that Medicare reimbursed.

As a result of the kickback scheme, Owens and his conspirators caused a loss to Medicare of more than $10 million.
Conspiracy to violate the federal Anti-Kickback Statute is punishable by a maximum potential penalty of five years in prison and a fine of $250,000, or twice the gain or loss from the offense, whichever is greatest.

Attorney for the United States Khanna credited special agents of the FBI, under the direction of Special Agent in Charge Brian Driscoll; the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Naomi Gruchacz; the U.S. Department of Defense, Office of the Inspector General, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Patrick J. Hegarty; and the U.S. Department of Veterans Affairs Office of Inspector General, under the direction of Special Agent in Charge Christopher F. Algieri with the investigation leading to the charge.

The government is represented by Assistant U.S. Attorneys Garrett J. Schuman and Katherine M. Romano of the Health Care Fraud Unit and Senior Trial Counsel Barbara A. Ward of the Asset Recovery and Money Laundering Unit.