A Kenyan man is facing multiple fraud-related charges in Texas and could end up spending years behind bars if convicted.
Oscar Simon Ndereva, alias Dereva, is said to have defrauded American health insurers of over $1 million between August 2019 and January 2020 through fake claims, according to prosecutors.
During the period, Ndereva allegedly sent more than 780 fraudulent claims to different insurers seeking $5.068 million.
Daily Nation reports that he was arrested in Texas in October and was charged with 16 counts. He pleaded not guilty to all the charges.
Court documents indicate that Ndereva committed most of the offenses using the identity of another Kenyan man named JK, who left the US in 2005 and never returned. He used JK’s details to obtain a fake driver’s license, open bank accounts, register companies, cash checks, among other crimes.
The first three counts, which carry a maximum of 20 years in prison, are on wire fraud and cover Ndereva’s activities between 2015 and 2020.
Texas prosecutors said the accused “controlled and operated fraudulent healthcare businesses, including a pharmacy called Healogix.”
“From in or around 2015 to the date of this indictment, in the Eastern District of Texas and elsewhere, Mr Ndereva devised...a scheme and to defraud BlueCross BlueShield and to obtain money and property by means of materially false and fraudulent pretenses, representations and promises,” the charges read.
Prosecutors said Ndereva used JK’s details to open Healogix pharmacy business. It is believed he investigated the system used to make health insurance claims and devised a way of deceiving insurers to pay even when there was no patient.
“Beginning in or around August 2019 and continuing to around January 2020, Mr. Ndereva, under the guise of Healogix, submitted fraudulent claims to commercial health insurance payers requesting payment for services and medication allegedly prescribed by doctors and provided to patients,” prosecutors told the Texas court.
“However, the medication identified on the Healogix claims submitted to the payers were never prescribed by a physician and never delivered to the people listed on the claims.”
Ndereva also faces two counts of money laundering, which also a maximum of 20 years in jail. Prosecutors told the court that he cleaned money obtained through wire fraud, cashing cheques, and using a debit card assigned to JK.
The next seven charges are also related to money laundering, where the court heard that he used cheque payments from Healogix to individuals.
The payments were made in trances of less than $10,000 to prevent banks from reporting them as per US law. The seven transactions in the indictment are related to checks to people of amounts ranging from $6,000 to $9,850.
The final three charges are about identity theft linked to Ndereva’s transactions on January 6th and 7th, 2020, where he allegedly used accounts in JP Morgan Chase, BBVA Compass, and other banks to receive the money he claimed from insurers. He is said to have opened two bank accounts at BBVA Compass using JK’s identity in January.
Out of the $5,068 million Ndereva falsely claimed from medical insurers, prosecutors said at least $1 million was paid through the JP Morgan Chase account.
Should he be convicted, the money in the accounts will be forfeited to the government. The counts he faces come with an option of fines.