Prosecutors: Scam ring stopped at Florida veterans hospitals

Federal prosecutors say they have broken up a fraud scheme at veterans hospitals in South Florida

WEST PALM BEACH, Fla. -- Fraudulent suppliers stole millions from the federal government by bribing purchasing agents and others at South Florida veterans hospitals and then billing for orders that were non-existent or grossly overpriced, federal prosecutors said Wednesday.

Ten Veterans Affairs employees and five vendors have been charged, U.S. Attorney Ariana Fajardo Orshan told reporters at a West Palm Beach news conference. She said the scam began almost a decade ago and involved hospitals in Miami-Dade and Palm Beach counties.

According to Fajardo Orshan and court documents, the employees ordered medical equipment and other supplies such as toilet paper and laundry detergent from the vendors. The vendors would then ship nothing or a partial order, but the employees would mark it in the computer system as fully received.

When the government paid the vendors for the full order, the employees received a kickback, prosecutors allege. The payments to the charged employees ranged from about $2,000 to more than $10,000, documents allege.

“Public officials are not for sale," Fajardo Orshan said. “Public benefits and public programs cannot be purchased with kickbacks and bribes."

All 15 defendants have been arrested.