Two former U.S. Marines were sentenced in federal court to more than a year in prison for their role in a fraud scheme that bilked TRICARE, the military’s health care program, out of more than $65 million, federal officials said Friday.
Daniel Castro, from Oak Lawn, Ill., got a 21-month sentence, and Jeremy Syto, of Chula Vista, received 15 months. Both men had been based at Marine Corps Air Station Miramar. A nurse practitioner, Candace Craven, was sentenced as well, to three months home confinement.
At the center of the scheme are compound medications — drugs that are custom-made by pharmacists to meet a patient’s unique needs and are significantly more expensive than typical prescription drugs.
Castro and Syto recruited fellow Marines to receive the drugs in return for a monthly kickback of about $300, federal officials said. In turn, Castro and Syto were paid a commission — between 3 and 7 percent of the total TRICARE reimbursement paid to the pharmacy for the drugs sent to the Marines-turned-straw beneficiaries.
Over the course of the conspiracy, Castro pocketed more than $1 million and Syto raked in about $260,000. The amount TRICARE paid out in insurance reimbursements was much higher, federal officials said. All told, the health care program paid nearly $12 million in insurance reimbursements for compounded medications to Castro’s recruits. TRICARE paid more than $8.5 million for compound medications prescribed to Syto’s recruits.
Craven and others wrote the bogus prescriptions and filled out fraudulent paperwork to access the insurance reimbursements, according to prosecutors.
“This outrageous scheme undermined health services for those who risk their lives to serve our country,” U.S. Attorney Tara McGrath said in a statement. “Our military members and taxpayers deserve so much better. This case reflects our dedication to the well-being of our armed forces and our steadfast protection of the U.S. taxpayer.”
The three defendants were working for Jimmy and Ashley Collins, a married couple out of Birchwood, Tenn. Jimmy Collins was sentenced two weeks ago to 10 years in prison. His wife got 18 months in home confinement. The couple was also ordered to pay more than $65 million in restitution.
During the investigation, authorities seized numerous items and properties purchased by the Collinses with the money they made off the operation, including an 82-foot yacht; two Aston Martins; gold and silver bars; dozens of pieces of farm equipment; and three pieces of Tennessee real estate.
