SECOND DEFENDANT IN FAKE FLU VACCINE CASE CONVICTED

HOUSTON, TX - The second of two persons was convicted today of health care fraud charged as the result of the administration of fake flu vaccine to area senior citizens and 1,100 employees and contractors of ExxonMobile last fall, United States Attorney Don DeGabrielle announced today.

At a hearing held this afternoon, Martha Denise Gonzales, 49, of Baytown, Texas, pleaded guilty to health care fraud. United States District Judge Kenneth M. Hoyt, who accepted Gonzales's guilty plea, convicted her of the federal felony offense and set sentencing for December 11, 2006. Gonzales faces a maximum of 10 years of imprisonment and a $250,000 fine. The court has permitted Gonzales to remain free on bond pending her sentencing hearing.

The investigation that led to the indictment of Gonzales and Iyad Abu El Hawa, her co-defendant in this case, began in October 2005 after the FBI received information that fake flu vaccine may have been given at a health fair sponsored by Exxon for its Baytown refinery employees. Laboratory analysis of several recovered syringes containing the "flu" vaccine recovered by investigating agents proved to contain sterile water.

Iyad Abu El Hawa pleaded guilty to health care fraud and misbranding of a drug last week and remains in federal custody pending his sentencing set for December 4, 2006.

At today's hearing, Gonzales admitted she falsely represented herself to be a licensed nurse, when in fact she has never been licensed in any capacity at any time by the State Board of Nursing Examiners. Gonzales, who worked in a Baytown area physician's office as a billing clerk, met El Hawa in the summer of 2005. Together they agreed to organize health fairs at senior residence homes and offer flu shots as a way to build clients for El Hawa's home health care businesses.

To further that agreement, Gonzales called and obtained information from a Baytown pharmacist regarding an out-of-state flu vaccine distributor. El Hawa obtained a credit application from the out-of-state distributor that Gonzales filled out using the name and DEA number of a Baytown physician, without the physician's knowledge or consent. She also signed the physician's name to the application without his knowledge or consent. The application was never sent to the distributor and no vaccine was ordered. However, Gonzales would later represent to the same Baytown pharmacist that she had thousands of doses of flu vaccine to sell, and that she had purchased them from the out-of-state distributor he had recommended.

Gonzales did purchase thousands of syringes and needles, which came from an out-of-state company. These syringes and needles were delivered to El Hawa for "pre-loading" with sterile water by one of his employees. On October 14, 2005, Gonzales used the "pre-loaded" syringes to administer what she represented to be the flu vaccine to more than a dozen residents of a Houston senior residence complex. These seniors, who were covered by Medicare and Medicaid, were billed by Mrs. Gonzales for flu shots, again using -- without authorization -- the name and billing number of a physician.

In the summer of 2005, Gonzales contacted ExxonMobil and offered to give flu vaccines. At the time, ExxonMobil declined because it had already contracted with another company. However, when the shortage in flu vaccine prevented the execution of that contract, ExxonMobil staff reconsidered and contacted Gonzales. Gonzales told ExxonMobil staff she had 500,000 doses of flu vaccine to sell, and signed a contract. In that contract, Gonzales falsely represented herself as a representative of a Baytown physician. The physician had no knowledge that she had signed the contract.

Gonzales and El Hawa, and others at their direction, administered the fake shots to approximately 1,100 employees and contractors of Exxon on October 19 and 20, 2005. Throughout the month of October, several other health fairs were held at seniors' residential homes where seniors received fake shots.

Laboratory test on several "pre-loaded" syringes recovered by investigating agents from several sources confirmed that the fluid contained in the syringes was not the flu vaccine, but rather a form of purified water. The FDA discovered neither harmful substance in the water, nor any harmful bacteria on the syringes themselves.

Additionally, El Hawa's employee directed to "pre-load" the syringes used at the Exxon Health Fair in October 2005 voluntarily submitted to testing for blood borne pathogens. The results of those tests were negative for HIV and Hepatitis.

The investigation leading to the original indictment was conducted by the Federal Bureau of Investigation, the Food and Drug Administration Office of Criminal Investigations, the Department of Health and Human Services Office of Inspector General, the Texas Department of State Health Services and the Texas Attorney General's Medicaid Fraud Control Unit, with the assistance of the Harris County Public Health and Environmental Services.