Prosecutors want to retry Florida healthcare exec Philip Esformes
Justice Department prosecutors said Monday they will retry
convicted Miami Beach business executive Philip Esformes on unresolved
healthcare fraud charges from his first trial in federal court, despite
President Donald Trump's commutation of his 20-year sentence before leaving
office in January.
Prosecutors told U.S. District Judge Robert Scola of their
intentions to try Esformes again on the main healthcare fraud conspiracy charge
and five other deadlocked counts, with plans to move forward with the retrial
after he has exhausted the appeal of his 20 corruption-related convictions in
the initial 2019 trial.
Scola will consider a new trial date for Esformes early next
year. In the meantime, prosecutors said they will ask the judge to require bond
conditions including an electronic ankle monitor for the former healthcare
mogul. A bond hearing is set for early May.
Esformes received clemency from Trump just before Christmas,
freeing him immediately after spending four and a half years behind bars. The
president's commutation blindsided Justice Department prosecutors not only
because Esformes' fraud case was the biggest in the history of the Medicare
program but also because his trial was so bitterly fought over months.
Trump's commutation only affected the 52-year-old businessman's
prison sentence — not his conviction or the half-dozen charges that the jury
was unable to reach verdicts on. Esformes still has to repay $5.3 million to
the taxpayer-funded Medicare program along with a $38 million forfeiture
judgment to the U.S. government.
A Justice Department spokesman declined to comment on the
government's decision to retry Esformes.
Miami attorney Howard Srebnick, one of several lawyers on
Esformes' defense team, could not be immediately reached for comment about his
client's retrial.
At his 2019 federal trial in Miami, Esformes was found
guilty of 20 counts of paying kickbacks, money laundering and obstruction of
justice in the $1 billion case. Esformes, who owned a chain of skilled-nursing
and assisted-living facilities in Miami-Dade, was accused of paying off medical
professionals at Larkin Hospital and elsewhere to recycle hundreds of Medicare
patients through his network at taxpayer expense.
At sentencing that September, Scola called Esformes' scheme
of paying bribes to generate thousands of Medicare patients for his chain of
facilities in Miami-Dade "unmatched in our community, if not our
country" and said he "violated [the system's] trust in epic
proportions."
Esformes wept at his sentencing but refused to accept responsibility
for his crimes under pressure from the judge, so that he could challenge his
convictions before the U.S. Court of Appeals for the 11th Circuit, which is
still pending.
Prosecutors described Esformes as an unscrupulous
businessman who used proceeds from his crimes to not only pay off doctors and
other medical professionals for patients to feed his 16 nursing homes and ALFs
in Miami-Dade, but also to buy luxury real estate, a Ferrari, fancy watches and
escorts at five-star hotels. They also proved that Esformes paid hundreds of
thousands of dollars in bribes to the basketball coach at the University of
Pennsylvania to get his son into the Ivy League school, with the coach
testifying at trial that the son was unqualified and took the place of a qualified
recruit.
"This is not a mistake," Allan Medina, a Justice
Department prosecutor, said at Esformes' sentencing, describing his history of
fleecing the Medicare system. "Day after day, this defendant chose to
steal, this defendant chose to bribe."
Esformes' defense team, including Srebnick and his partner,
Roy Black, have sought to sully the Justice Department's case by claiming it
was contaminated with improperly seized evidence from one of their client's
healthcare facilities.
In Trump's commutation, a White House statement alluded to
Esformes' appeal "challenging his conviction on the basis of prosecutorial
misconduct" by federal prosecutors relating to an FBI search and seizure
of records from the office of the healthcare executive's lawyer in one of his
Miami-Dade facilities. Esformes' defense team argued that the search and
seizure of those documents violated "attorney-client privilege"
between the businessman and his company lawyer, that the prosecution's evidence
was tainted and its case should be thrown out along with the prosecutors.
That didn't happen.
Ultimately, however, the controversial issue over the FBI's
gathering of privileged documents from the office of Esformes' company lawyer
became a moot point for Scola because prosecutors agreed not to use any of that
evidence at his trial — making that issue a "red herring" on the
businessman's pending appeal, according to prosecutors.
Esformes' commutation, along with his defense team's
accusations of government misconduct, have rankled the Justice Department,
according to federal authorities familiar with the healthcare fraud case.
Esformes' clemency relief has been spotlighted by the Herald
and other major newspapers, including the New York Times, as a symbol of
insider influence. Critics of the president's pardons and commutations said
they were really about taking care of "moneyed and privileged"
political cronies and white-collar criminals — including Trump's former
advisers Stephen Bannon, Paul Manafort and Roger Stone — rather than those with
draconian sentences for drug offenses.
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