Law Offices of Jeffrey Lichtman Wins Dismissal of New York State Medicaid Fraud Case

In a widely reported and very rare move, a New York State judge dismissed all charges against the director of a Brooklyn adult day healthcare center, accused of Grand Larceny in the First degree of over $6.5 million of Medicaid money. Facing up to 25 years in prison, Gelena Deverman’s case was dropped due to the lack of sufficient grand jury evidence upon review by the court. This decision occurred after a two years of investigation by the New York Attorney General’s office into the billing procedures of the Northern Manor Adult Day Healthcare Center in Brooklyn. Most top criminal lawyers in New York will have a result like this once in a career: that is the level of rarity of this result.

Prior to filing criminal charges against Ms. Deverman, the Attorney General’s Office settled with the owners of the adult day healthcare center for $6.5 million. In that civil settlement, the adult day healthcare center admitted that it operated the program without a qualified social worker on staff from July 1, 2010 through on or about June 30, 2011. Nevertheless, none of the owners of the center were charged criminally and instead Ms. Deverman, the director of the center, was charged with a B Felony Grand Larceny Charge in the First Degree (N.Y. Penal Law § 155.42), for allegedly permitting the submission of fraudulent bills to Medicaid with the awareness that the adult day healthcare center was not in compliance with applicable rules and regulations because there was not a licensed social worker on the premises. Despite her having received not a single dollar from this alleged fraud, Ms. Deverman was the only person initially charged with a felony in this case.

Not surprisingly, we believed that the case was overcharged as often does occur in New York or federal criminal cases. The court ultimately agreed, finding that the grand jury evidence revealed that the defendant was in any way involved in submitting the allegedly false billings to Medicaid or even supervised the person who did submit the bills. “Simply put, the grand jury evidence showed that the defendant was responsible only for the day to day management of [the center], not the creation and submission of certifications and bills.” In addition, the judge determined that Ms. Deverman made no false representations of any kind to Meidcaid or anyone else. And just like that, the Grand Larceny charge was dismissed and the defendant, who had been facing up to 25 years in prison, got her life back.

Overreaching By the Attorney General

Interestingly, the Attorney General has been criticized for overreaching in other matters, most recently in its attempts to stop fantasy sports companies, DraftKings and FanDuels from taking wagers from New York residents and its efforts to regulate many other industries in New York, such as probing internet service providers for allegedly false claims about internet speeds and charging that ExxonMobile was dishonest about climate change. As we have watched and litigated against the New York Attorney General’s Office for over 25 years, it has always been apparent that the sitting Attorney General often has loftier goals: to advance to the governor’s mansion in New York, paving the way by protecting the consumer. If you are a victim of such overreaching or are charged in a criminal case in New York, you will need a top New York criminal defense attorney to fight for your rights. Call the Law Offices of Jeffrey Lichtman at (212) 581-1001 to speak to a lawyer today.