A judge at the U.S. District Court for the Southern District of Florida has sentenced the man, Miguel de Paula Arias, to 161 months in prison, and three years of supervised release, for violating federal benefits laws. The judge has also ordered Arias to pay about $1.7 million in restitution to the victims, according to officials at the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) unit and at the U.S. Department of Justice.
Bruce Udolf, a Fort Lauderdale, Florida, attorney who has represented Arias, said via email, in a comment about the case, that his client is remorseful about his conduct.
“He sought a sentence within the range provided for by the U.S. Sentencing Guidelines applicable to his offense, which the court imposed,” Udolf said.
Arias, who has been in federal custody since December 2016, earlier pleaded guilty to one count of health care fraud, one count of making false statements relating to health care matters, and one count of aggravated identity theft. EBSA is involved because Arias sent some of the fake health plans to group health plans governed by the Employee Retirement Income Security Act, officials say.
Arias, stole the identities of at least four retired or semi-retired physicians, then used the physicians’ information to create bank accounts, according to a stipulated factual proffer filed with the court in July in support of the please agreement.
Arias also mined Social Security Death Master File records, according to the government’s lawyers.
Insurers use the death file records to identify annuity holders and life insurance insureds who have died.
Government lawyers say Arias used the records in another way: He searched for information about people who had recently died, then combined information about people who had died with information about older physicians to file fake medical claims with Medicare and private plans.
The plans sent payments straight to the physician bank accounts Arias had set up, government lawyers say.
In May 2016, government lawyers say, Arias tried to use a fake passport to set up a bank account in West Palm Beach, Florida. A bank employee noticed that the passport looked fake and called the police. Dusten Campbell, a detective with the West Palm Beach Police Department, said he searched Arias’s car and found a Social Security Death Master File DVD. The DVD was dated Nov. 30, 2015, and held 90,385,702 death records, according to an affidavit submitted by Campbell.
Arias has committed health care fraud before, according to Ellen Cohen, an assistant U.S. attorney who represented the government at a detention hearing in January.
Arias was convicted of Medicaid fraud in Florida in 1999, Cohen said, according to a hearing transcript.
While Arias was on probation for that offense, he committed health care fraud in New Jersey and Pennsylvania, Cohen said.
Later, while criminal cases filed in New Jersey and Pennsylvania were still moving through the courts, Arias committed mortgage fraud, Cohen said.
Around that time, she said, Arias went to Chile for two years with $19,000.
Arias “only returned to the United States as a result of his visa expiring, and he was about to be deported and was deported,” Cohen said.
The lawyer who represented Arias at the detention hearing emphasized that Arias had turned himself in.
Udolf, who represented Arias in sentencing proceedings in October, asked the sentencing judge, in a sentencing memorandum, to limit Arias’s time in prison to 108 months. Udolf said in the sentencing memorandum that Arias had committed a non-violent offense, had undergone treatment for substance abuse problems, and had expressed deep remorse for his actions. Arias had also agreed to help the authorities find his assets and get them to the court, Udolf said.
This article was updated after the original publication time with comments from Arias’s attorney.