Additional Information for Compass Detox

UPDATE As of July 7, 2022:

Jose Santeiro was found guilty of Conspiracy to Commit Health Care Fraud and several counts of Health Care Fraud.  Santeiro was sentenced to 54 months in prison and 3 years supervised release.  In addition Santeiro was ordered to pay $2,122,500.00 in restitution. 

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As of March 24, 2022:

The Medical Director of two South Florida addiction treatment facilities was convicted today after a 15-day trial of engaging in a scheme that fraudulently billed approximately $112 million for substance abuse services that were never provided or were medically unnecessary.

According to court documents and evidence presented at trial, Jose Santeiro, 72, of Miami Lakes, Florida, a doctor, worked with others to unlawfully bill for approximately $112 million of addiction treatment services that were never rendered and/or were medically unnecessary at two addiction treatment facilities where Santeiro was the Medical Director. The facilities were Second Chance Detox LLC, dba Compass Detox (Compass Detox), an inpatient detox and residential facility, and WAR Network LLC (WAR), a related outpatient treatment program.

Santeiro was convicted of conspiracy to commit health care fraud and wire fraud and eight counts of health care fraud. He faces up to 20 years in prison for the conspiracy count and up to 10 years in prison for each health care fraud count. A federal district court judge will determine the sentences after considering the U.S. Sentencing Guidelines and other statutory factors.

LINK: https://www.justice.gov/opa/pr/addiction-treatment-facilities-medical-director-convicted-112-million-addiction-treatment

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As of March 21, 2022:

Two brothers who operated multiple South Florida addiction treatment facilities were sentenced to prison Friday for a $112 million addiction treatment fraud scheme that included paying kickbacks to patients through patient recruiters and receiving kickbacks from testing laboratories.

Jonathan Markovich, 37, and his brother, Daniel Markovich, 33, both of Bal Harbour, were sentenced in the Southern District of Florida to 188 months and 97 months in prison, respectively.

After a seven-week trial in November 2021, both defendants were convicted of conspiracy to commit health care fraud and wire fraud. Jonathan Markovich was convicted of eight counts of health care fraud and Daniel Markovich was convicted of two counts of health care fraud. They were also both convicted of conspiracy to pay and receive kickbacks and two counts of paying and receiving kickbacks. Jonathan Markovich was separately convicted of conspiring to commit money laundering, two counts of concealment money laundering, and six counts of laundering at least $10,000 in proceeds of unlawful activities. He was also convicted of two counts of bank fraud related to fraudulently obtaining PPP loans for both Compass Detox and WAR during the COVID-19 pandemic.

LINK: https://www.justice.gov/opa/pr/addiction-treatment-facility-operators-sentenced-112-million-addiction-treatment-fraud-scheme

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As of November 4, 2021:

A federal jury in the Southern District of Florida convicted two operators of two South Florida addiction treatment facilities for fraudulently billing approximately $112 million for services that were never provided or were medically unnecessary, and for paying kickbacks to patients through patient recruiters, and receiving kickbacks from testing laboratories. One defendant was also convicted of money laundering, and of separate charges of bank fraud connected to Paycheck Protection Program (PPP) loans.

According to court documents and evidence presented at trial, Jonathan Markovich, 37, and his brother, Daniel Markovich, 33, both of Bal Harbour, conspired to and did unlawfully bill for approximately $112 million of addiction treatment services that were never rendered and/or were medically unnecessary, and that were procured through illegal kickbacks, at two addiction treatment facilities that they operated, Second Chance Detox LLC, dba Compass Detox (Compass Detox), an inpatient detox and residential facility, and WAR Network LLC (WAR), a related outpatient treatment program. Jonathan Markovich, who owned both facilities, was also convicted of bank fraud in connection with PPP loan applications in which he falsely stated that Compass Detox and WAR were not engaged in illegal conduct.

The evidence showed that defendants obtained patients through patient recruiters who offered illegal kickbacks to patients (such as free airline tickets, illegal drugs, and cash payments). The defendants then shuffled a core group of patients between Compass Detox and WAR to fraudulently bill for as much as possible. Patient recruiters gave patients illegal drugs prior to admission to Compass Detox to ensure admittance for detox, which was the most expensive kind of treatment offered by the defendants' facilities, therapy sessions were billed for but not regularly provided or attended, and excessive, medically unnecessary urinalysis drug tests were ordered. Compass Detox patients were given a so-called "Comfort Drink" to sedate them, and to keep them coming back. Patients were also given large and potentially harmful amounts of controlled substances, in addition to the "Comfort Drink," to keep them compliant and docile, and to ensure they stayed at the facility. Certain patients were also routinely re-admitted and repeatedly cycled through Compass Detox and WAR to maximize revenue.

Both defendants were convicted of conspiracy to commit health care fraud and wire fraud. Jonathan Markovich was convicted of eight counts of health care fraud and Daniel Markovich was convicted of two counts of health care fraud. They were also convicted of conspiracy to pay and receive kickbacks and two counts of paying and receiving kickbacks. Jonathan Markovich was separately convicted of conspiring to commit money laundering, two counts of concealment money laundering, and six counts of laundering at least $10,000 in proceeds of unlawful activities, as well as two counts of bank fraud related to his fraudulently obtaining PPP loans for both Compass Detox and WAR during the COVID-19 pandemic. Both defendants are scheduled to be sentenced on Jan. 13, 2022. They each face a maximum of 20 years for the health care fraud and wire fraud conspiracy count, 10 years for each substantive count of health care fraud and paying and receiving kickbacks, and five years for the kickbacks conspiracy. Jonathan Markovich faces additional maximum sentences of 20 years for conspiracy to commit money laundering, 20 years for each substantive count of concealment money laundering, 10 years for each additional count of money laundering, and 30 years for each substantive count of bank fraud.

LINK: https://www.justice.gov/opa/pr/south-florida-addiction-treatment-facility-operators-convicted-112-million-addiction