A superseding indictment was unsealed today charging Isabel Tcruz and Noli Tcruz with tax evasion and multiple health care fraud offenses, and charging Dr. Terry S. Baul with participating in a health care fraud conspiracy, U.S. Attorney Matthew Schneider announced today. Previously, only Isabel Tcruz had been indicted with health care fraud offenses in this case.
Schneider was joined in the announcement by Special Agent in Charge Sarah Kull, Internal Revenue Service, Criminal Investigation, Detroit Division and Special Agent in Charge Lamont Pugh, U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
Charged in the superseding indictment are:
Isabel Tcruz, 61, of Washington Township
Noli Tcruz, 65, of Washington Township
Dr. Terry S. Baul, 69, of Detroit.
According to the Superseding Indictment, during May 2011 to January 2018, Isabel Tcruz and Noli Tcruz owned and operated multiple home health care companies in Roseville, Michigan, including Maxicare Home Health Agency, Inc., Faith Home Care Services, LLC, and Affinity Home Care, LLC, though they sold Affinity Home Care in December 2014. They also owned and operated home health agencies in Arizona and Nevada. The companies were enrolled as participating providers with Medicare and submitted claims to Medicare. As part of that enrollment, Isabel and Noli Tcruz agreed to comply with all Medicare rules, which included that they would not violate the Anti-Kickback statute. Dr. Terry S. Baul operates a family practice in Detroit.
The superseding indictment alleges that, from approximately September 2007 through the present, Isabel and Noli Tcruz engaged in tax evasion. During that time they willfully avoided paying approximately $602,154.91 in taxes, not including interest and penalties, which had been assessed against them for the years 2006-2009. Isabel and Noli Tcruz avoided paying their taxes in numerous ways, including using their home health care business bank accounts to pay more than $440,000 in personal expenses. They also placed funds beyond the reach of the IRS by diverting money from their businesses to other people, and those people used the money to pay Isabel and Noli Tcruz’s personal expenses. Among other things, Isabel and Noli Tcruz used money from their businesses to purchase a home in Michigan for $675,000 and a home in Henderson, NV for $925,000. From 2011 to 2017, Isabel and Noli Tcruz used their businesses to pay, directly or indirectly, approximately $909,020.55 in personal expenses, and they issued checks from their business accounts made payable to themselves, but diverted the money to others to pay their expenses, totaling approximately $1,616,239.26.
The superseding indictment further alleges that, from May 2011 through January 2018, Isabel Tcruz, Noli Tcruz, Dr. Terry Baul, and other doctors conspired to defraud the United States by paying and receiving health care kickbacks. In short, Isabel and Noli Tcruz, through their home health care companies, arranged with multiple physicians, including Dr. Baul, to pay the physicians, and for the physicians to receive, kickbacks and bribes in exchange for referring Medicare beneficiaries and providing Medicare beneficiary information that was used to support false and fraudulent claims by the business entities. Isabel and Noli Tcruz then submitted or caused the submission of claims to Medicare for home health care services that were provided or purportedly provided to the beneficiaries.
Isabel Tcruz, Noli Tcruz, Dr. Baul, and the other physicians attempted to disguise the illegal kickbacks. For example, Isabel Tcruz paid Dr. Baul in cash and gifts, rather than payments that could be tracked.
Isabel and Noli Tcruz are also charged with separate counts based on specific instances where they paid kickbacks or bribes.
Fraudulent claims to Medicare totaling at least $12,000,000 were submitted that were obtained through illegal kickbacks and bribes, and not otherwise eligible for Medicare reimbursement.
An indictment is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
The case was investigated by Special Agents of IRS Criminal Investigations and HHS-OIG.
The case is being prosecuted by Assistant U.S. Attorneys Brant Cook and Andrew Lievense.
USAO - Michigan, Eastern;
Department of Health and Human Services OIG