An ongoing federal investigation into prescription drug fraud has led to 30 people so far from Atlantic County and nearby being charged since August 2017.
Prosecutors have said the illegal scheme centers on the billing of the state’s public employee health benefits plans for medically unnecessary compounded drugs, with payouts from prescription reimbursements going to line the pockets of all participants.
Drug compounding is a process in which a pharmacist mixes ingredients to a drug customized for a specific application, concentration or ingredient. While the process is legal, it’s not regulated by the U.S. Food and Drug Administration. The drug mixtures are expensive, with a tube of cream costing thousands of dollars each, and health insurance companies provide large reimbursements to pharmacies for filling these prescriptions. Recent federal prosecutions have uncovered massive abuse in similar investigations across the country.
Most of the people charged are from Atlantic County, including several public employees and pharmaceutical representatives, and one doctor. According to court documents, the scheme targeted teachers, firefighters, police officers, state troopers and other public employees due the generous coverage under the state health benefits plans.
Kristie Masucci, of the Cedar Run section of Stafford Township, a former pharmaceutical representative from Ocean County was sentenced in August 20, 2019, to 24 months in prison, three years probation and faces restitution of more than $1.8 million.
Masucci served as a recruiter from January 2015 through February 2016, persuading individuals in Atlantic County and elsewhere with state benefits to obtain medically unnecessary compounded medications from an out-of-state pharmacy. She admitted to receiving $388,608 for her role in the conspiracy.
Robert Bessey, of Philadelphia, a gym floor installer, agreed to forfeit $485,540 and pay restitution of at least $2.7 million.
Michael Pepper, of Northfield, a retired Atlantic City firefighter, pleaded guilty to conspiracy to commit health-benefits fraud. As part of the plea agreement, Pepper will forfeit $113,627 and pay restitution of $719,481.
Thomas Hodnett, of Voorhees, a pharmaceutical sales representative, served as recruiter in the conspiracy. Hodnett agreed to forfeit more than $269,966 and pay restitution of $1.5 million.
Judd Holt, of Marlton, a Burlington County pharmaceutical representative, pleaded guilty to separate charges of conspiracy to commit health care fraud. Holt defrauded health-insurance plans of more than $769,000 and must forfeit more than $95,000.
George Gavras, of Moorestown, a Burlington County pharmaceutical representative, pleaded guilty to separate charges of conspiracy to commit health care fraud. Gavras admitted to defrauding plans of more than $679,000 and must forfeit more than $204,000.
Michael Neopolitan, of Willow Grove, a pharmaceutical sales representative, has admitted to defrauding New Jersey state health benefits programs and other insurers out of millions of dollars by submitting fraudulent claims for medically unnecessary prescriptions.
Andrew Gerstel, of Galloway Township, is a pharmaceutical representative. As part of his plea agreement, Gerstel must forfeit $184,389 in criminal proceeds he received for his role in the scheme and pay restitution of at least $483,946. He faces up to 10 years in federal prison and a $250,000 fine.
Timothy Frazier, of Galloway Township, a commercial construction estimator, submitted fraudulent claims for medically unnecessary prescriptions.
Michael Pilate, of Williamstown, and a Pleasantville High School guidance counselor, was described in court as a mid-level conspirator who received $500 from a co-conspirator per prescription he filled, according to court testimony. He also recruited other people and paid them each $500 per prescription, according to court testimony. As part of Pilate’s plea agreement, he must forfeit $392,684 and pay restitution of $3.49 million — the amount of fraud resulting from his participation in the scheme.
Shawn Sypherd, of Upper Township, a middle school teacher, admitted to conspiracy to commit fraud of the State Health Benefits Plan. Sypherd’s actions resulted in more than $2.4 million in fraudulent reimbursements from the State Health Benefits Plan. He received more than $354,264 for his role as a recruiter, according to court documents.
Michael J. Sher
Richard Erick McAllister
William Hunter, an industrial equipment salesman from Sewell, must forfeit about $245,020 and pay restitution of at least $1.32 million, according to his plea agreement.
James Wildman, of Marmora, an Ocean City school maintenance worker, admitted serving as a recruiter in the conspiracy, persuading individuals, especially those on the state health benefits plan, to obtain medically unnecessary compounded prescriptions in exchange for money. Wildman said he received $657,040 for his role in the scheme.
Corey Sutor, of Egg Harbor Township, a Ventnor firefighter, admitted to receiving about $150,000 for his role in the scheme. He joined the Ventnor Fire Department in 2008.
Edward Sutor, of Linwood, a Ventnor firefighter, admitted to receiving about $335,552 for his role in the scheme. Edward Sutor stated with the department in 2013.
Christopher Broccoli, of West Deptford, Gloucester County, a Camden firefighter, was charged with conspiracy to commit health care fraud and wire fraud and with individual acts of health care fraud and wire fraud
Jason Chacker, 36, of Feasterville, Pennsylvania, a physician’s assistant who practiced in Mercer County, pleaded guilty in October 2019 before Judge Robert Kugler to conspiracy to commit health care fraud in the scheme involving compounded medications.
Laboratory sales representative Steven Monaco, 37, of Sewell, who founded and operated SMJ Consultants LLC, pleaded not guilty in October 2019 after being charged in a 33-count indictment with conspiracy to commit health care fraud and wire fraud.
Dr. Daniel Oswari, 48, of Bordentown, who operated a practice in Trenton, pleaded not guilty in October 2019 after being charged in a 33-count indictment with conspiracy to commit health care fraud and wire fraud.
Dr. Michael Goldis, 63, of Mount Laurel, who operated a practice in Stratford, pleaded not guilty in October 2019 after being charged in a 33-count indictment with conspiracy to commit health care fraud and wire fraud.
Aaron Jones, 25, of Willingboro, who worked as a medical assistant for Goldis, pleaded not guilty in October 2019 after being charged in a 33-count indictment with conspiracy to commit health care fraud and wire fraud.