Health Care Fraud—Fake Vaccines

A Houston man has been indicted for allegedly attempting to defraud federal health care agencies after giving fake flu vaccines to senior citizens and ExxonMobil employees.^[1] Iyad Abu El Hawa and his employee Martha Denise Gonzales have been charged on 14 counts of conspiracy to commit mail and health care fraud, making false statements to federal agents, and tampering with a consumer product.^[2]

The investigation began in October when the FBI received a tip that fake vaccine may have been administered to ExxonMobil employees.^[3] The fake vaccine, it turns out, was nothing but purified water, and the FDA, which tested it, “discovered no harmful substance in the water nor any harmful bacteria on the syringes themselves.”^[4]

According to the indictment, the scheme was to employ licensed and unlicensed staff members to lend their names, title, credibility, and legitimacy to a number of businesses Mr. El Hawa allegedly owned.^[5] These businesses would serve as “fronts.”^[6]

Conspiracy to Commit Mail and Health Care Fraud
Under 18 U.S.C. § 1349, any person who conspires to commit mail and health care fraud—or any other kind of fraud—will be punished as if he had actually committed the offense.

Mail Fraud
We have previously discussed mail fraud here.

Health Care Fraud
Under 18 U.S.C. § 1347, it is a crime for a person to devise and execute a scheme or artifice to defraud a health care benefit program in connection with the delivery of or payment for health care benefits. The punishment for committing health care fraud is a fine, imprisonment for up to 20 years, or both.

False Statements
Under 18 U.S.C. § 1001(a)(2), it is a crime for a person to knowingly make a false or fraudulent statement to an agent within the jurisdiction of the executive branch of the United States. The punishment for doing so is a fine, imprisonment for up to 5 years, or both.

Tampering with Consumer Products
Under 18 U.S.C. § 1365(a), it is a crime for a person to have reckless disregard that another person will be placed in danger of death or bodily injury, and under circumstances manifesting extreme indifference to the risk, to tamper with any consumer product in interstate commerce. The punishment for a violation of section 1365(a) is a fine, imprisonment for up to ten years, or both.^[7]

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[1] 2 Indicted in Fake-Vaccine Case, Houston Chronicle, Nov. 17, 2005, available here.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] 18 U.S.C. § 1365(a)(4).