Ring Members Diverted AIDS Drugs

Florida Attorney General Charlie Crist and U.S. Attorney Alexander Acosta announced four individuals, including two Miami physicians, have been arrested for allegedly participating in an organization that illegally diverted millions of dollars worth of highly valued AIDS drugs from Medicaid recipients and resold them on the black market.

U.S. Marshals arrested Onelio S. Baez, 65, the individual responsible for constructing, funding and directing the operation, and Juan Carlos Mateo, 44, a patient recruiter and runner who was employed by Baez to recruit Medicaid recipients to participate in the scheme. The two Miami doctors, Luis Jacinto Marti, 73, and Jorge Arnaldo Valido, 48, are accused of aiding Baez and Mateo by writing prescriptions for expensive drugs that were neither necessary for nor received by the Medicaid recipients.

An investigation revealed that Baez built a large criminal organization made up of corrupt medical professionals, family members and friends. Together, they ran a scheme that fraudulently used Florida Medicaid funds to obtain millions of dollars in human immune globulin, used to treat patients with AIDS.

Members of the fraud ring recruited and paid Medicaid recipients from the streets to visit Marti and Valido. The doctors allegedly prescribed expensive medications, created bogus medical records to document the “illnesses,” wrote prescriptions and used cooperating pharmacies to fill prescriptions. Medicaid was billed more than $1 million for the drugs, which were diverted and sent to a broker, who sold the medication to buyers. Cash from these sales was funneled back to the ring leaders, who pocketed the proceeds.

Each of those arrested will be prosecuted for one count of conspiracy to defraud the United States and 16 counts of committing healthcare fraud and paying kickbacks.