LOS ANGELES
Federal prosecutors on Wednesday filed criminal charges against nine defendants – seven of them dockworkers at the Port of Long Beach – who allowed more than $2.1 million in fraudulent claims to be submitted to their labor union’s health insurance plan for sexual services or for physical therapy that never was provided, officials stated.
The conspiracy’s ringleader, Sara Victoria, 46, of San Pedro, is charged with one count of conspiracy to commit health care fraud and one count of aggravated identity theft.
The plea agreements for Victoria and the other eight defendants were filed in federal court.
According to her plea agreement, from January 2017 to August 2021, Victoria owned and operated three business: Back to Life Wellness Center LLC and The Chiroman Wellness Center – both based in San Pedro – and the Wilmington-based Waterfront Wellness Center Inc.
These companies offered patients chiropractic services, acupuncture treatments, and also sexual services.
Victoria knew that dock workers and others involved in the shipping industry in Long Beach had health insurance under the International Longshore and Warehouse Union – Pacific Maritime Association (ILWU-PMA) benefit plan.
This plan generally covered all chiropractic services with no deductible and without requiring plan members to contribute any copay amount or out-of-pocket services.
Victoria hired women to provide sexual services to dock workers at her companies and recruited them through referrals and from strip clubs in the Long Beach area.
In exchange for obtaining sexual services for themselves and their friends, ILWU-PMA plan members authorized Victoria to submit false claims for reimbursement for services not actually rendered, according to authorities.
This included chiropractic and physical therapy, using their names or the names of their family members, such as their spouses and children.
Victoria also agreed to pay ILWU-PMA plan members cash kickbacks in exchange for authorization to submit false claims for reimbursement for services not actually rendered.
Victoria also admitted to using someone else’s identity without the person’s consent during the commission of the health care fraud conspiracy.
In total, Victoria submitted approximately $2,110,920 in claims to the ILWU-PMA plan, for which the plan paid approximately $551,810.
After Victoria enters a plea of guilty, she faces up to 12 years in federal prison.
Also charged this week was Cameron Rahm, 39, of Pico Rivera, a Long Beach longshoreman and ILWU member.
He is charged in an indictment with one count of conspiracy to commit health care fraud, two counts of health care fraud, and one count of making false statements to federal investigators.
Rahm allegedly was one of the customers of Victoria’s businesses and agreed to have her submit to the ILWU-PMA plan fraudulent claims for services not rendered or for sexual services.
He also allegedly lied to FBI agents investigating this case when he denied allowing anyone to bill his health insurer for sexual services.
If convicted of all charges, Rahm is facing up to 10 years in federal prison for the conspiracy and health care fraud counts and five years in federal prison for the false statements count.
Defendants are presumed innocent unless proven guilty.
The FBI and the United States Department of Labor – Employee Benefits Security Administration investigated this matter.
Assistant U.S. Attorney Jason C. Pang of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting this case.