MISSION, TEXAS —
A former Pharr city commissioner was convicted Wednesday for his role in a scheme to defraud Blue Cross Blue Shield of Texas, federal prosecutors announced.
Oscar Elizondo, 47, conspired to submit more than $1.7 million in fraudulent insurance claims for high-priced pain patches and scar creams.
Elizondo was a marketer for Penitas Family Pharmacy in the South Texas town of Penitas, where he targeted employers that carried employee health insurance through Blue Cross, including the Pharr and Point Isabel Independent School District.
The city leader offered meals, drinks and promises of free prescription pain patches and scar creams to entice employees to turn over their insurance information. Meanwhile, his co-conspirators used the insurance information to submit fraudulent claims for treatments that employees never received.
Other employees were sent to a doctor involved in the scheme who received kickbacks, including cash, loans and prescription drugs. Elizondo also set up a temporary office for the doctor in a vacant office and a rented recreational vehicle where they solicited employees to write fraudulent prescriptions.
Elizondo vacated his seat on the commission earlier this year. He faces up to 10 years in federal prison and a $250,000 maximum fine when he is sentenced early next year before U.S. District Judge Randy Crane. He is free on bond, pending his sentencing.
The FBI, Mission Police Department, Texas Department of Insurance - Fraud Unit and Texas Health and Human Services Commission conducted the investigation.
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| Omar Espericueta, 45, the owner of a Penitas Family Pharmacy |
A federal grand jury has indicted the owner of a Rio Grande Valley pharmacy and a former Pharr city commissioner in a health insurance scheme to defraud Blue Cross and Blue Shield of Texas, federal prosecutors announced Friday.
Oscar Elizondo, 47, a former city commissioner of Pharr, and Omar Espericueta, 45, the owner of a Penitas Family Pharmacy, were charged with health care fraud, conspiracy to commit health care fraud and aggravated identity theft, according to a 16-count indictment.
Authorities allege Elizondo and Espericueta targeted employers that carry employee health insurance through Blue Cross, submitting more than $1.7 million in fraudulent claims for treatments that many employees never received.
Working with contacts at the cities of Mission and Pharr, Frontera Produce and Point Isabel Independent School District, Elizondo allegedly promised free prescription scar creams and pain patches to entice employees to hand over their insurance information, according to the indictment. The insurance information and prescriptions were then used to submit fraudulent claims to Blue Cross, prosecutors allege.
The indictment alleges Espericueta directed some employees to a doctor he was paying bribes to, including cash, loans and prescription drugs. On some occasions, it said, Espericueta and Elizondo, who vacated his seat on the commission earlier this year, set up a temporary office for the doctor in a vacant office, or a rented recreational vehicle where they solicited employees in order to write fraudulent prescriptions.
Conspiracy to commit health care fraud and health care fraud carry a maximum sentence of 10 years in federal prison. Aggravated identity theft carries a mandatory two‐year additional prison term.
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Pharmacy owner released in federal healthcare fraud case
Attorney says USAO’s office taints cases with news releases
McALLEN, TX — The owner of a local Valley pharmacy is back home after a federal judge granted him bond Tuesday morning.
Omar Espericueta, 45, of Mission, posted a $100,000 bond Tuesday afternoon after U.S. Magistrate Judge Dorina Ramos granted him an unsecured bond, court records show.
Espericueta, who owns Peñitas Family Pharmacy, also known as Riverside Pharmacy, had been in detention of the U.S. Marshals’ Service since last Thursday when he was arrested in connection with a healthcare fraud scheme that government prosecutors say involved nearly $2 million in fraudulent health insurance claims, according to court records.
But Espericueta’s attorney, Carlos A. Garcia, a Mission-based criminal defense attorney, said he was displeased with a news release that followed his client’s arrest last week.
The news release, which detailed elements of the allegations against the two men, was sent by the U.S. Attorney’s Office, a common practice utilized by the office to underscore prominent cases.
Garcia said Wednesday that the USAO’s practice of releasing selected information contained within a complaint or indictment and then disseminating it to the media is done in an attempt to sway opinion of defendants.
“I’m not surprised by the USAO releasing a statement in an effort to taint or influence the perception of an arrest, but that negative perception is just that, perception,” Garcia said.
“The law requires that people who will eventually sit in judgment of Omar are instructed that the mere fact that a person was arrested, charged or indicted of an offense, raises no inference of guilt,” he added.
The USAO’s release last week related to the arrest of Espericueta and an associate included the following line at the bottom of the release: “An indictment is an accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.”
Federal agents also arrested former Pharr commissioner Oscar Elizondo, 41, of Pharr, in connection with the scheme.
Elizondo served as a marketer for Espericueta’s pharmacy.
Elizondo, who faced Ramos on Monday morning for his initial appearance hearing and is expected to be back in court Thursday to lobby for his own release, faces two counts of healthcare fraud, two counts of aggravated identity theft, and one count of conspiracy to commit healthcare fraud, which could land him in federal prison for up to 10 years.
A request for comment sent to Elizondo’s attorney, Ricardo Salinas, went unreturned as of deadline.
Federal prosecutors allege that the two men submitted nearly $2 million in fraudulent claims to Blue Cross and Blue Shield of Texas for costly pain patches and scar creams, court records show.
Espericueta on Tuesday pleaded not guilty to all 16 counts in the indictment — which included eight counts of healthcare fraud, and three counts of fraud with identification documents, to name a few.
In addition to the punishment range of 10 years each and a $250,000 fine, the government is seeking a monetary judgment of about $1.4 million, records show.
Garcia said he was looking forward to the trial, and would be back in court with his client Sept. 1 for a pre-trial hearing.
“Mr. Espericueta is strong in his faith — in his commitment to the truth,” Garcia said. “And the truth in this case will eventually set him free.”