KYC (CDD): Medicare fraud and money laundering


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The FBI’s recent focus on Medicare fraud is revealing money-laundering operations as well. The FBI announced in May that it had arrested 50 South Florida residents as part of a nationwide Medicare Fraud Strike Force Operation. Forty other individuals in other states were charged as well.

According to the FBI, one of those charged is Eduardo Perez de Morales, 26, of Miami. He is charged with one count of conspiring to launder the proceeds of health care fraud.

According to Court records, Jorge Emilio Perez de Morales Sante, the brother of Eduardo and himself a fugitive defendant previously charged, operated a money-remitting company that moved money from the United States to Cuba.

The previous indictment alleges that Jorge Emilio Perez de Morales and his brother Eduardo Perez de Morales laundered health care fraud proceeds through the money remitting company’s bank accounts. The United States is seeking forfeiture of $238,067,956.

According to a related Miami Herald report, Eduardo Perez de Morales was charged and taken into custody in May for his role in the allegedly channeling of over $200 million in illicit Medicare profits to Cuba. The initial 2012 estimation of $70 million in laundered Medicare funds garnered national attention and put Oscar L. Sanchez, the owner of a Naples check-cashing business, behind bars for a four-and-a-half year sentence. Eduardo Perez’ fugitive brother, Jorge Emilio Perez de Morales Sante, is believed to be in Cuba, although Mexico, Spain, or the Dominican Republic are also possibilities.

Eduardo Perez is accused of conspiring with his brother to launder money through his brother’s offshore remittance company, Caribbean Transfers.  Prosecutors suspect Caribbean Transfers of cashing checks for Medicare fraud offenders and then wiring the money through Canada to Cuba.

According to the Miami Herald, Caribbean Transfers denies any illegal activity and claimed that their legitimate remittances were tainted by the Medicare money. They further argue that the Miami banks that accepted the fraudulent Medicare payments and the Miami remittance company that used Caribbean Transfers to wire the money to Cuban families are the parties to blame.

The remittance company has not been identified, but it is believed to be La Bamba, whose owner, Juan René Caro, is currently serving 18 years in jail for falsifying money transfer reports.

Caribbean Transfers, which closed down in 2012, claimed to specialize in sending money from Cuban exiles back to their families in Cuba.