Federal prosecutors on Wednesday, September 14 filed criminal charges against nine defendants, seven of them dockworkers at the Port of Long Beach. The scheme milked more than $2.1 million in fraudulent claims from their labor union’s health insurance plan for “sexual services” or for physical therapy that never was provided.
Protesting is hard work it seems…
The story begins back in January 2017, when Sara Victoria, now 46, who owned three different “physical therapy” businesses, Life Wellness Center LLC and The Chiroman Wellness Center, both based in San Pedro, California, and the Wilmington, California-based Waterfront Wellness Center Inc. These companies offered patients chiropractic services, acupuncture treatments, and also sexual services.
Victoria and friends knew that dock workers and others involved in the shipping industry in Long Beach had health insurance under the International Longshore and Warehouse Union – Pacific Maritime Association (ILWU-PMA) benefit plan. This plan generally covered all chiropractic services with no deductible and without requiring plan members to contribute any copay amount or out-of-pocket costs for services.
Victoria then hired additional women to provide sexual services to dock workers at her companies. She recruited them through referrals and from strip clubs in the Long Beach area. In exchange for obtaining sexual favors for themselves and their friends, ILWU-PMA plan members authorized Victoria to submit false claims for reimbursement for services not actually rendered, including chiropractic and physical therapy.
The plan holders used their names or the names of their family members, such as their spouses, and most sickening, their children. Victoria also agreed to pay ILWU-PMA plan members cash kickbacks in exchange for authorization to submit false claims for reimbursement for services not actually rendered.
Victoria filed $2,110,920 in claims to the ILWU-PMA plan, of which approximately $551,810 was considered fraudulent. The operation ran until August 2021. After Victoria entered a plea of guilty, she could face a statutory maximum sentence of 12 years in federal prison.
I’d love to be there when they explain this to their families…
Also charged in this case was Cameron Rahm, 39, of Pico Rivera,California, a Long Beach longshoreman and ILWU member whom a federal grand jury charged in an indictment with one count of conspiracy to commit healthcare fraud, two counts of healthcare fraud, and one count of making false statements to federal investigators.
Rahm allegedly was one of the customers of Victoria’s businesses and agreed to have her submit fraudulent claims for services not rendered or for sexual services to the ILWU-PMA plan. He also allegedly lied to FBI agents investigating this case, which never works out well.
Rahm denied allowing anyone to bill his health insurer for sexual services. He is expected to appear for arraignment this afternoon in United States District Court in Los Angeles.
If convicted of all charges, Rahm would face a statutory maximum sentence of 10 years in federal prison for the conspiracy and healthcare fraud counts, and five years in federal prison for the false statements count.
The FBI and the United States Department of Labor – Employee Benefits Security Administration investigated this matter. Assistant United States Attorney Jason C. Pang of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting this case.
If you would like to read the DOJ’s press release on the matter, please follow the link.
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