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Taesung Kim, age 58, of Great Neck and Dacheng Lu, age 44, of Flushing, Queens are each accused of submitting false and fraudulent claims to Medicare and Medicaid, according to an indictment unsealed Tuesday, May 2, in federal court in Brooklyn.
The pair owned and operated four pharmacies located in Brooklyn and Queens.
According to federal prosecutors, between January 2015 and December 2022 Kim and Lu conspired with others to submit the fraudulent claims to Medicare and Medicaid for the dispensing of prescriptions and over-the-counter products that were not medically necessary, procured by the payment of kickbacks and bribes, or not provided.
They also worked with others who paid illegal kickbacks and bribes in the form of cash and supermarket gift certificates to Medicare beneficiaries and Medicaid recipients who filled prescriptions at their pharmacies, prosecutors allege.
Illegal kickbacks were also paid to the doctors prescribing the unnecessary medications in the form of rent and office space, according to investigators.
Altogether, Kim and Lu submitted approximately $26 million in fraudulent claims, prosecutors said.
They allegedly laundered the proceeds through shell entities to generate cash that was then dispersed as profits to themselves and the pharmacies’ other owners, and paid to customers as kickbacks.
Kim and Lu are each charged with the following:
- Conspiracy to commit health care fraud
- Conspiracy to commit money laundering
- Conspiracy to pay illegal health care kickbacks and bribes
If convicted on all counts, they each face up to 35 years in federal prison.
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