The Testing is 90 Percent Legit

The president of Parsippany, N.J.-based Biodiagnostic Laboratory Services LLC (BLS), three BLS employees and three associates admitted to a conspiracy in which millions of dollars in bribes were paid to physicians over a number of years in exchange for blood sample referrals worth more than $100 million to the company.

Each of the seven defendants – David Nicoll, 39, of Mountain Lakes, N.J.; Scott Nicoll, 32, of Wayne, N.J.; Cliff Antell, 38, of Rumson, N.J.; Luke Chicco, 40, of Garden City, N.Y.; Doug Hurley, 33, of Hillsborough, N.J.; Kevin Kerekes, 47, of Florham Park, N.J.; and Craig Nordman, 34, of Whippany, N.J. – pled guilty to an information charging him with one count of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act and one count of money laundering.

The defendants entered their guilty pleas before U.S. District Judge Stanley R. Chesler in Newark federal court.

“Today seven men, including the president of a diagnostic lab, admitted to a conspiracy making more than $100 million in illegal income from business brought through bribes,” said U.S. Attorney Paul Fishman. “Individual greed has no place in a treatment plan, and people seeking medical help deserve to know a doctor’s recommendations are based on professional expertise, not illicit profits. Today is an important step, but we aren’t finished holding criminals responsible for this conspiracy, or who break the law to put profits over patients.”

Federal officials alleged that the conspiracy made millions in illegal profits between 2006 and April of 2013.

During their guilty pleas, David and Scott Nicoll admitted that BLS made substantially more than $100 million from Medicare and private insurance companies – just from bills related to blood specimens sent to BLS by bribed doctors.

Federal officials detailed the means through which BLS paid doctors millions of dollars – in cash or under the guise of sham lease, service, and consulting agreements through an elaborate network of shell entities used for that purpose.

The defendants also admitted that one component of the bribery scheme was to pay some doctors a fee per test to induce them to increase their ordering of certain tests.

In one text message conversation between Santangelo and David Nicoll detailed in filed documents, Santangelo stated that he and another doctor had “put our heads together and added a significant amount of testing.  . .The testing is 90% legit.”

The documents allege Santangelo planned to send $1 million per month in blood testing referrals to BLS by increasing the number of blood tests being ordered, including medically unnecessary tests.

Those who pled guilty today each face a maximum potential penalty of five years in prison and a $250,000 fine on the bribery conspiracy charge and 20 years in prison and a $500,000 fine on the money laundering charge, or twice the gross gain or loss from the offense.

David and Scott Nicoll have agreed to forfeit $50 million and $25 million to the United States, respectively.

The other five defendants will forfeit amounts ranging between $800,000 and $1.3 million. Sentencing for all seven defendants is scheduled for Sept. 11, 2013.

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