On April 1, 2022, the Department of Justice (“DOJ”) announced a Missouri based non-profit, Preferred Family Healthcare (“PFH”), admitted to the misuse and misappropriation of federal funds designated for healthcare services. PFH received most of its funding from Medicaid reimbursement to provide mental and behavioral treatment for individuals in Missouri, Arkansas, Kansas, Oklahoma, and Illinois. However, PFH’s former employees and executives participated in a fraud and bribery scheme that misused millions in public tax dollars.

According to the terms of their non-prosecution agreement, PFH’s former executives and employees embezzled millions from charities and bribed several Arkansas elected officials. PFH will forfeit more than $6.9 million to the federal government and pay more than $1.1 million in restitution to the state of Arkansas. They previously reached a $6.5 million False Claims Act settlement with the state of Arkansas in October 2020. PFH’s initial settlement came after their therapists fraudulently billed millions for purported counseling services to mentally ill patients.

Several of PFH’s former executives and employees, along with former members of Arkansas’ state legislature, have pleaded guilty to bribery and embezzlement charges in separate criminal cases. PFH’s former chief operating officer and chief financial officer pleaded not guilty after being indicted by a federal grand jury in 2019, and the duo currently awaits trial. Tyler Hatcher, Special Agent in Charge of IRS-Criminal Investigation, declared that they “[…] will continue to work diligently to uncover large frauds designed to divert funds that were meant to help those in need of medical services […].”

The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with white-collar criminal investigations and health care fraud investigations. If you need assistance with such a matter, please contact us today.