Torrance man sentenced for tax evasion for hiding fees in multimillion health care fraud conspiracy


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Date: March 10, 2022


A South Bay man was sentenced to 12 months plus one day in federal prison for tax evasion.

Jeffrey Lawrence, a.k.a. Jey Lawrence, of Torrance, was sentenced on February 28, 2022 by United States District Judge R. Gary Klausner. In addition to the prison sentence, Judge Klausner ordered Lawrence to pay restitution of $100,919.

Lawrence pled guilty to a single count of tax evasion stemming from his referrals in 2015 of prescriptions to TC Medical Pharmacy. In March 2015, Lawrence entered into an agreement with pharmacy owner Thu Van Le, whereby Le agreed to pay Lawrence for the referral of compounded medications prescriptions. Between March and June 2015, Lawrence then directed Le to pay more than $300,000 in referral fees to another person's bank account in order to conceal Lawrence's receipt of taxable income.

Lawrence did not file a tax return for the year in which he earned the referral fees that were paid to his nominee's account. After deductions, Lawrence's taxable income from the concealed referral fees was more than $280,000, and his tax due was more than $100,000.

Jeffrey Lawrence and Thu Van Le were among six defendants indicted by a federal grand jury on June 21, 2018.

"The American tax system is built on the structure of voluntary compliance; however, there are always a few individuals, like Mr. Lawrence, who cheat the system and take advantage of the public's trust by evading their tax-paying duty through complex schemes such as the use of nominee accounts to hide income," said Ryan L. Korner, Special Agent in Charge of IRS-CI's Los Angeles Field Office. "As the defendant faced his day in court, we are reminded again of IRS-CI special agents' resolve and ability to follow the money. By working together with our partners, our agents uncovered Mr. Lawrence's deception and collected what is rightfully owed to the American public, including penalties and interest."

"Mr. Lawrence's sentencing is a fitting end to his participation in an illicit scheme to defraud the Department of Defense's TRICARE program and other federal healthcare programs that was fueled by pure greed," said Bryan D. Denny, Special Agent in Charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. "DCIS will continually work with its law enforcement partners to protect the integrity of our healthcare system so that in the end, all patients receive the best care possible at a cost that is not inflated by fraudulent actions like those of Mr. Lawrence."

"Mr. Lawrence pleaded guilty to tax evasion for essentially concealing kickbacks," said Kristi Johnson, the Assistant Director in Charge of the FBI's Los Angeles Field Office.

"Mr. Lawrence was a marketer for a compounding pharmacy that had an illegal kickback arrangement with marketers to pay a percentage of prescription claim reimbursements to marketers in exchange for the referral of compounded medication prescriptions. The FBI devotes resources to detect and hold accountable those who defraud the health care system. This is just the latest example."

"We're very proud of our joint efforts with the cross-agency team of investigators and the U.S. Attorney's Office who helped move this case forward," said Tom Hopkins, Special Agent in Charge of Amtrak OIG's Western Field Office. "Our office will vigorously investigate and help bring to justice those who engage in such criminal activity as we work to protect Amtrak funds, American taxpayers, and the traveling public."

"The U.S. Department of Labor will continue to work with our federal and state law enforcement partners to bring perpetrators to justice," said Employee Benefits Security Administration Regional Director Crisanta Johnson, in Los Angeles.

"The integrity of the Federal healthcare programs is threatened when providers submit false claims," said Amy K. Parker, Special Agent in Charge, OPM OIG. "The OPM OIG is committed to working closely with our law enforcement partners in order to protect taxpayer funds from fraud."

"This sentencing should send a message that fraud of any kind will not be tolerated and will be investigated to protect hardworking California consumers and businesses," said Insurance Commissioner Ricardo Lara. "Thanks to the hard work by this multi-agency taskforce this defendant has been brought to justice."

The case was investigated by the Defense Criminal Investigation Service, Defense Contract Audit Agency - Operations Investigative Support, FBI, Amtrak Office of Inspector General, U.S. Department of Labor - Employee Benefits Security Administration, IRS Criminal Investigation, U.S. Office of Personnel Management Office of Inspector General, and the California Department of Insurance.

Assistant United States Attorney Mark Aveis prosecuted this case.