Possible plea deal in the works for Delray Beach sober home operator Eric Snyder

A preliminary hearing in federal court  for  Eric Snyder, owner and operator of a Delray Beach drug treatment center and sober home raided by the FBI in December 2014, has been delayed for 30 days to give attorneys time to “consider whether or not a pre-indictment resolution” can be worked out.

Snyder was arrested on July 11 and charged with fraudulently billing insurance companies for $58.2 million over nearly five years, according to court records.

Snyder, 30, and Christopher Fuller, 32, described in a 26-page federal complaint as a “junkie hunter” hired by Snyder, were charged with conspiracy to commit health care fraud. The document described how Snyder bribed patients with airline tickets, cash, rent and visits to strip clubs. Fuller trolled AA meetings and “crack” motels to find patients, the complaint said.

The court hearing was reschedule to Oct. 16.

Musclebound millionaire: The Palm Beach Post’s story on Eric Snyder

Snyder Snyder is one of the many drug treatment operators exposed in a 2-1/2 year-long Palm Beach Post investigation that revealed the profits to be made from urine-screening in the county’s thriving but corrupt sober home industry.

Snyder’s treatment center, Real Life Recovery, and sober home, Halfway There, raked in more than $18 million from the $58.2 million in fraudulent claims to insurance companies, including Blue Cross/Blue Shield, United Healthcare, Aetna, Cigna and Humana for urine drug tests and “bogus” treatment, according to court documents.

The profits have attracted the attention of the Internal Revenue Service. In March, the IRS filed a lien, saying Snyder owed $2 million in back income taxes.

Shortly after his arrest, Snyder’s attorney, Bruce Zimet, said Snyder did not “intentionally” participate in fraud.

“Eric has personally been involved in saving many, many lives and making a difference in many other lives of those suffering from addiction,” Zimet said.

 

 

Doctor in Kenny Chatman case pleads guilty to health care fraud

Dr. Joaquin Mendez, a former medical director for Kenny Chatman’s notorious Reflections Treatment Center, pleaded guilty to conspiracy to commit health care fraud today.

He faces up to 10 years in federal prison.

Kenneth Chatman walks into Reflections, his treatment center in Margate, in 2015.

Mendez was the last holdout among eight people arrested in a fraudulent multi-million dollar drug treatment operation run by Chatman.

He admitted today to being essentially a doctor in name only for Reflections between September 2014 and September 2015. Although Mendez was supposed to be seeing patients and dictating their medical care, Chatman was the one deciding when people would get tested.

RELATED: ‘Kenny Chatman kidnapped me:’ Read one woman’s human trafficking story

Mendez would sign doctor’s orders without ever seeing the patients. He also signed off on hundreds of “certificates of medical necessity” for urine and saliva tests after the testing had already been done – and in some cases, the patients had already been discharged from Reflections.

If he had been closely following the drug test results, he would have noticed that up to 90% of the people in Chatman’s care were actively using drugs.

His actions helped turn Reflections, in Margate, and Chatman’s chain of sober homes into a multi-million dollar operation, despite Chatman having no experience in health care when he founded the facility in 2013.

Chatman’s crimes went far beyond health care fraud, however. His sober homes throughout Palm Beach County were houses of horror, where drug use was rampant and where some female patients were kept chained up so he could prostitute them. At least four people died of overdoses while in his care.

Chatman was sentenced to 27 1/2 years in prison in May. All of the other defendants also took plea deals, including another doctor and Chatman’s wife.

Mendez had held out because his attorneys, Richard Lubin and Anthony Vitale, wanted more time to review the mountain of evidence in the case, which included 326 gigabytes of digital records and 225 boxes of paper records.

Lubin said today that after reviewing the evidence, Mendez chose to plead guilty.

Mendez is scheduled to be sentenced Sept. 27.

Doctor in Kenny Chatman case expected to plead guilty

The last defendant in Kenny Chatman’s drug treatment fraud scheme is expected to plead guilty, according to a Thursday court filing.

Dr. Joaquin Mendez had pleaded not guilty to federal charges of money laundering and conspiracy to commit health care fraud. What he will plead guilty to is unknown; a change of plea hearing is scheduled for July 14.

Kenneth Chatman walks into Reflections, his treatment center in Margate, in 2015.

He was the final holdout among eight people arrested in a multi-million-dollar drug treatment operation created by Chatman, who was sentenced to 27 1/2 years in prison in May.

Chatman, a felon who had no experience in health care before he created Reflections Treatment Center in Broward County in 2013, also trafficked his female patients. In his sober homes scattered throughout Palm Beach County, he held women captive and prostituted them.

RELATED: ‘Kenny Chatman kidnapped me:’ Read one woman’s human trafficking story

Together, the defendants will have to pay back millions to more than a dozen insurance companies that were defrauded.

Mendez was a former medical director for the Reflections. One of the reasons he declined to take a plea deal is because his veteran defense attorney, Richard Lubin, wanted more time to evaluate the evidence.

The amount of evidence in the case was “massive” – more than he’d ever seen in his 42 years in law, Lubin wrote earlier this year. It included:

  • 326 gigabytes of digital records copied onto an encrypted hard drive.
  • 236,245 digital files organized into 8,307 folders
  • 16,064 records in 133 files of patient data
  • 1,719 patient case files with as many as 600 pages in each file
  • 30 FBI taped interviews
  • 225 boxes of paper documents that prosecutors said would take 6-8 weeks to copy

Chatman was first exposed in a 2015 Palm Beach Post story. He was also recently profiled by NBC News.

Drug treatment center doctor who worked for Kenny Chatman will stay out of jail

A doctor who worked for corrupt treatment center operator Kenny Chatman will not be going back to jail – at least for now.

Federal prosecutors wanted Dr. Joaquin Mendez, who is out on $100,000 bond, back behind bars after they argued he violated the terms of his release by treating patients and prescribing opioids.

Kenneth Chatman walks into Reflections, his treatment center in Margate, in 2015.

But Mendez’s lawyer, Richard Lubin, argued the terms were vague, and both sides agreed last week simply to amend the terms of his release.

Mendez, a former medical director for Chatman’s corrupt Reflections Treatment Center, is the only one of eight defendants not to have taken a plea deal for their involvement with the facility.

The seven others, including Chatman and his wife, Laura, were sentenced to a combined 58 years in prison.

Mendez has been charged with money laundering and conspiracy to commit health care fraud for ordering unnecessary urine drug tests for addicts, according to prosecutors.

One of the terms of his release, added in handwriting to the paperwork, was that he “not use his Medicare number to provide any services.”

Prosecutors said he violated those terms after he treated at least 188 Medicare patients wrote more than 100 prescriptions for controlled substances that included oxycodone, Oxycontin, clonazepam and fentanyl.

Lubin, his lawyer, argued the terms were weirdly vague.

“Not only is this Court and Dr. Mendez left guessing at what it means to ‘treat patients using his Medicare number,’ it is entirely unclear what the Government means by ‘Medicare number,'” Lubin wrote.

HEROIN: Killer of a generation

Apparently the ‘Medicare number’ prosecutors referenced was Mendez’s Provider Transaction Access Number, which Lubin said had “absolutely nothing to do with” Medicare claims.

On Thursday, both sides agreed to changing the terms of release.

Mendez is one of two doctors in charge of overseeing patient care at Chatman’s facilities to be arrested. Last Week, Dr. Donald Willems was sentenced to 10 years in prison – the maximum sentence – after pleading guilty to conspiracy to commit health care fraud.

Chatman was sentenced to 27 years in prison last month after admitting to turning his female patients into prostitutes and pimping them out online.

One of Kenny Chatman’s top doctors gets maximum sentence

Kenneth Chatman walks into Reflections, his treatment center in Margate, in 2015.

A doctor who treated patients at Kenny Chatman’s notorious drug treatment center was sentenced to 10 years in prison today.

Dr. Donald Willems, an osteopath, was the medical director for Chatman’s Reflections Treatment Center, in Broward County, from October 2015 to May 2016.

He admitted in his plea deal to signing off on drug tests and unnecessary allergy and DNA tests, which helped Chatman turn his drug treatment center into a multi-million dollar business.

Although Willems was supposed to be treating the patients at Reflections, he wasn’t monitoring the results of their drug tests, he admitted. If he was, he would have noticed that most of the patients were not sober and their drug tests were actually being submitted by other people, including Reflections workers.

‘Kenny Chatman kidnapped me’: Read one woman’s human trafficking story

The 10-year sentence was the maximum he could have received after pleading guilty to conspiracy to commit health care fraud.

HEROIN: Killer of a generation

Willems was one of two doctors arrested for working with Chatman, who was sentenced to 27 years in prison last month. Chatman admitted to turning some of his female patients into prostitutes at his sober homes in Palm Beach County. Even in South Florida’s widely corrupt drug treatment industry, Assistant U.S. Attorney Marie Villafaña called Chatman “the most dangerous” player in it.

>> HEROIN: Killer of a generation

Federal prosecutors say the other doctor, Dr. Joaquin Mendez, has violated the conditions of his release on bond, and they asked last week to arrest him again. Mendez is the only one of the eight defendants – which includes Chatman’s wife, Laura – to not take a plea deal.

Willems is also facing four-year-old state charges of racketeering and illegally providing oxycodone for his work at a pill mill in Broward County.

Doctor charged in Kenny Chatman case caught prescribing opioids

Kenneth Chatman walks into Reflections, his treatment center in Margate, in 2015.

Federal prosecutors are trying to get a doctor who worked for notorious treatment center operator Kenny Chatman back behind bars after they say he was caught prescribing the opioids Oxycontin and fentanyl to Medicare patients.

Dr. Joaquin Mendez, facing charges of conspiracy to commit money laundering and health care fraud in January, was out on $100,000 bond. As part of the conditions of his release, he was not allowed use his Medicare number to “provide any services,” according to a court filing on Friday. His Medicare number was also revoked after he was released.

But federal prosecutors say that between February and May, Mendez treated at least 188 Medicare patients, and he wrote more than 100 prescriptions for controlled substances that included oxycodone, Oxycontin, clonazepam and fentanyl.

‘Kenny Chatman kidnapped me’: Read one woman’s human trafficking story

Prosecutors wrote that agents learned Mendez was dropping in on assisted living facilities and asking if anybody wanted to see a doctor. He would then either write the patient a prescription or refer them to a home health agency.

A judge will decide whether he will be arrested again.

HEROIN: Killer of a generation

Mendez is the only co-defendant who has not taken a plea deal in the massive fraud case against Kenny Chatman and his treatment centers, Reflections, in Broward County, and Journey to Recovery, in Lake Worth.

Read The Post’s first story on Chatman: Police reports link sober home operator to prostitution

In addition to fraud charges, Chatman admitted to turning some of his female patients into prostitutes at his Palm Beach County sober homes. Last month, he was sentenced to 27 years in prison and forced to register as a sex offender. His lawyers said he will appeal the sentence.

Prosecutors say Mendez ordered unnecessary urine drug tests for patients at Reflections and Chatman’s other treatment center, Journey to Recovery, in Lake Worth.

Mendez would be the second doctor in the case to get caught violating the conditions of his release. Dr. Donald Willems went back to jail after police discovered he was working in a drug treatment center and prescribing drugs he was not authorized to prescribe.

Willems, who pleaded guilty to conspiracy to commit health care fraud, will be sentenced today in Miami. He faces up to 10 years in prison.

Kenny Chatman allies sentenced to prison

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Kenny Chatman walks to his Reflections Treatment Center in Margate in December 2015. (Richard Graulich / The Palm Beach Post)

More co-defendants of recovery industry pariah Kenny Chatman were sentenced to federal prison on Monday, but Chatman’s lawyer said he’ll need another month to figure out how to defend his client in sentencing.

On Monday, three of Chatman’s team were sentenced to a combined 12-1/2 years in federal prison. They pled guilty in a case in which Chatman is charged with supplying drugs to patients in his treatment program and sober homes and turning some into prostitutes.

Fransesia “Francine” Davis, who acted as a house mother at Chatman’s sober homes, was sentenced to 7 years in federal prison. Michael Bonds, who sent his own patients to Chatman’s corrupt treatment centers in exchange for payments, was given 4.75 years in prison. Stefan Gatt, who processed fraudulent urine samples from Chatman’s patients, was given an 18-month sentence.

Chatman has pleaded guilty in the case, but may not be sentenced until mid-June. His attorney, Saam Zangeneh, said he needs more time to read a sentencing of 300 paragraphs that includes “a slew of (sentencing) enhancements that are outside the scope of the plea agreement,” Zangeneh wrote Monday.

Kenny Chatman faces life in prison. His wife, Laura, faces 10 years in prison.

In a request for a lighter sentence, Bonds said he’d helped lead investigators to several arrests in his federal case and nine people in state court cases. His lawyer said  he expected federal prosecutors agree to a lighter sentence. Instead, they filed paperwork last week calling for a full sentence of 4.75 years in prison – not far above the 48 months he got.

Bonds and Gatt were also sentenced to three years’ probation and Davis to one year probation. Each must also pay an undetermined amount of restitution, federal records show. All three pleaded guilty to a charge of conspiracy to commit health care fraud, while Davis also faced a charge of using a house to distribute drugs.

Chatman defendant: Feds, state target sober homes together

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A recruiter for Kenny Chatman‘s drug treatment centers says his cooperation with state and local investigators led to about a dozen arrests.

A new federal court filing for Michael Bonds shows how defendants in several cases are being used against each other, as well as cooperation between federal and state officials trying to crack down on South Florida’s corruption-plagued sober home industry. Bonds’ attorney, Paul Walsh of West Palm Beach, said in a filing that he expects federal officials will also ask for leniency in the case because of Bonds’ cooperation.

Walsh wrote that in exchange for Bonds’ cooperation, Bonds and his wife have feared for their safety because of implied threats, “including a call from an individual whom Bonds provided information about, telling Bonds that he would ‘get his.'”

Bonds pleaded guilty in February to taking $240,000 from Chatman for referring patients to Chatman’s treatment centers. Chatman, Bonds and four other associates were arrested Dec. 21. The filing says Bonds has been helping investigators since August, and “has continuously provided assistance whenever called upon and as needed by the government.”

How far did that cooperation go? The filing says Bonds has been working with officials, including a Delray Beach Police Department investigator, to yield “results that are useful to the government.” A grammatically troubled sentence says he offered help on people in the recovery industry, and “This information led to prior to the arrest of at least nine individuals in State court and several individuals in this [federal] matter.”

Bonds is scheduled to be sentenced at 10 a.m. Monday in federal district court in West Palm Beach. He had been running Redemption Sober House Inc., and was getting about $500 a week for each patient he supplied to Chatman.

Chatman is scheduled to be sentenced next month. He admitted in federal court that he’d turned patients into prostitutes and, when they were supposed to be recovering from drugs, fueled their addiction.

While immediate associates of Chatman have been prosecuted in federal court, the Palm Beach County Sober Home Task Force has arrested at least 20 people for prosecution in state courts.

First woman arrested in sober home crackdown

BREAKING: Amanda LaFrance, 25, came to Florida three years ago to get clean and found herself in court on Saturday facing 13 counts of brokering other addicts with insurance to Whole Life Recovery, a treatment center in Boynton Beach whose owner and operator faces charges of paying kickbacks for clients.lafrance-mugshot

LaFrance is also the first woman to be charged in the Sober Home Task Force’s crackdown on patient brokering in the sober home business. All eight arrests stem from the business practices Whole Life Recovery.

According to the arrest affidavit, LaFrance deposited $6,750 in 13 checks from Whole Life Recovery for case management services. Deon Hill, her business partner and father of her 6-month-old daughter, deposited a check for $525 from the treatment center.

>> Read more: Addiction Treatment – Inside the gold rush << 

Hill, 50, has not been charged but is currently being held without bond at the Palm Beach County Detention Center on an unrelated armed robbery charge.

LaFrance’s public defender asked that LaFrance be released on her own recognizance or supervised release because she has no criminal history. Her mother, Lorraine Rucki, asked that she be allowed to take her daughter back to New Jersey for treatment or to place her in detox in Palm Beach county.

Assistant State Attorney Justin Chapman argued that LaFrance should be held on the recommended bail:  $39,000 – $3,000 for each of the 13 counts.

“We are dealing with a very vulnerable population,” Chapman said. “They are being herded like cattle basically.”

However, she will remain in jail until she can prove that the money that would be used to post her bail did not come from illegal activities.

LaFrance’s monther, Lorraine Rucki, testified that her daughter relapsed, is homeless, has no job and is already experience withdrawal symptoms in jail.

Palm Beach County State Attorney Dave Aronberg, who created the task force in July with $275,000 from the legislature, said there will be more arrests.

“The heroin crisis is fueled by bad actors in the treatment industry,” Aronberg said. “Our task force will continue to target sober homes that violate Florida Law and jeopardize their residents safety.”

MORE DETAILS TO FOLLOW.

 

 

State Attorney’s sober home task force meeting today

In its last session, the Legislature gave funding to State Attorney Dave Aronberg to establish a task force to come up with recommendations on how to clean up the sober home industry.

Today, it’s having its first full meeting, with the goal of driving out bad operators and increasing the quality of care for recovering addicts.

What the group will ultimately recommend to the Legislature is still a mystery, but a smaller meeting of the task force, on Tuesday, laid out what it won’t do. And Chief Assistant State Attorney Al Johnson, which is leading the group, gave it some areas to focus on.

First, what it won’t do:

  • Johnson said the task force won’t be looking at zoning requirements for sober homes (federal laws make that illegal).
  • It won’t be going after drug addicts or good operators.
  • It won’t be focusing on prosecuting bad operators, although Johnson said the State Attorney’s Office is convening a grand jury to look at the overall issue.

“We can’t prosecute ourselves out of this,” Johnson said Tuesday. “We’re going to knock some heads, I presume. We’re not sitting on our hands. We have a lot of tips coming in.”

Today’s meeting is open to the public and will be held from 2 p.m. to 5 p.m. in the community room of the West Palm Beach Police Department at 600 Banyan Blvd.

So far, the task force is looking at tackling four key issues:

Who should regulate the recovery industry?

Nearly everyone agrees that Florida’s Department of Children and Families, which currently oversees drug treatment centers, doesn’t have the resources to do it adequately.

Instead, the state’s Agency for Health Care Administration, which licenses health care facilities, is widely considered the more appropriate department for the job, and the task force will look at whether transferring the responsibilities is possible.

Sober homes, however, can’t be regulated because of federal housing and disability laws.

But the idea is to get them voluntarily certified by an accrediting agency — in this case, the Florida Association of Recovery Residences, which has strict guidelines and requirements for its members.

But FARR doesn’t have enough funding to certify the thousands of sober homes in the state. So one of the task force members proposed having the members themselves fund the process. Johnson said that could be a good idea.

“If we left this up to DCF to license and register, we’d be little better off than where we are now,” Johnson said. “Sometimes when an industry regulates its own, it can be as effect or more effective than government.”

Clearing up the laws

Much of the task force’s focus is going to be clearing up the laws to make it clear what’s legal and what’s not.

At Tuesday’s meeting, lawyers for sober homes said their clients spend a lot of money on lawyers simply to figure out how to operate within the law.

That’s because the laws are confusing, said Mark Fontaine, executive director of the Florida Alcohol and Drug Abuse Association.

“The providers want clarity. They want to know what’s okay and what’s not okay,” he said.

How should recovering addicts pay for rent at sober homes?

Current patient brokering laws don’t allow medical providers to bribe patients to go to their business or pay for headhunters to lure patients.

That also goes for the drug treatment industry. But patient brokering is considered rampant in the industry, with recovering addicts often enticed to stay at sober homes with offers of free gifts or free rent.

But it’s not really free. In some cases, the addict has to go to a particular outpatient therapy during the day, which charges the person’s insurance. Or the sober home simply wants the addicts in the home so it can make money drug-testing them.

Johnson proposed a radical idea: make it legal for treatment centers to pay for an addicts’ rent at a certified sober home.

That would accomplish two things: good sober homes would automatically have a leg up on the bad actors, because they’d be certified, and bad actors would be encouraged to clean up their act and get certified.

How should sober homes be marketed?

This is another gray area.

Fontaine wanted to know if anything could be done about treatment centers or sober homes that falsely advertise their services or facilities. He said he spoke to one addict’s mother, for example,

And there’s another area of marketing that is a source of concern. Many sober home and treatment center operators will pay people, known as “marketers,” to bring in patients, which is illegal.

But the industry wants that cleared up, too. Attorney Jeffrey Lynne said licensed interventionists are worried about how they can be paid for their work without violating the patient brokering laws.

“That’s what their job is, to do intake and where to place someone,” Lynne said. “Their whole profession has been tainted by this concept of marketing.”