FOR IMMEDIATE RELEASE   DONNA KRISE   
DEC. 1, 2008    PUBLIC AFFAIRS OFFICER 
WWW.USDOJ.GOV/USAO/TXS  (936) 639-4003    

(HOUSTON) - Edem James Etuk, 55, the former owner of PMS Medical Equipment Distributors, has been sentenced to federal prison and ordered to pay restitution to the Medicare program for his role in defrauding the federal health care program of almost $4 million in a motorized wheelchair fraud scheme, acting United States Attorney Tim Johnson announced today.

United States District Judge Lynn N. Hughes sentenced Etuk this afternoon to 60 months in prison and ordered to pay $1,590,756 in restitution to Medicare and Medicaid. The prison term is to be followed by a three-year-term of supervised release. Etuk pleaded guilty in October 2007 to conspiracy to defraud Medicare and health care fraud admitting he engaged in a 14-month conspiracy with several individuals, including Houston doctor Michael D. Kim, to commit health care fraud, wire fraud and to illegally pay kick-backs in relation to the Medicare program that resulted in fraudulent billings to Medicare of $3.8 million. During his plea, Etuk admitted he was the owner of PMS Medical Equipment Distributors, a durable medical equipment company and Medicare provider. He engaged in a scheme to defraud Medicare by billing Medicare for motorized wheelchairs which were either not required by the Medicare beneficiary or not delivered, or both. Etuk purchased Certificates of Medical Necessity (CMN), which are required to bill Medicare, from several doctors including Kim for cash. Etuk admitted paying Kim $200 cash for every fraudulent CMN.

The Medicare beneficiaries in this case were recruited illegally by marketers. Etuk has admitted he paid the local Houston marketers for beneficiaries and also that he purchased CMNs directly from the marketers for $600 to $1000 each. According to Etuk, Kim routinely falsified the CMNs and certified non-qualified Medicare beneficiaries for motorized wheelchairs. Etuk used the fraudulent CMNs to falsely bill Medicare for approximately $3,880,000 in power wheelchairs and accessories and received approximately $1,590,756 in Medicare/Medicaid payment over the course of the conspiracy.

Kim, 68, was convicted of the conspiracy to defraud Medicare and numerous counts of healthcare fraud, wire fraud and money laundering after a lengthy trial in August 2008. Kim is scheduled to be sentenced on Feb. 12, 2009.

The investigation leading to the charges against Etuk and Kim was jointly conducted by agents of the FBI, the U.S. Department of Health and Human Services Office of Inspector General (HHS/OIG), and the Medicaid Fraud Control Unit of the Texas Attorney General's Office into what has become known as the "motorized wheelchair fraud scheme." This case was prosecuted by Assistant United States Attorney Al Balboni.