$405 Million Forfeited: Texas Pharmacist’s Fraudulent Compound Cream Scheme Exposes Vulnerabilities in Healthcare Systems
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A Texas pharmacist, Dehshid “David” Nourian, 62, of Plano, has been sentenced to 17 years and six months in prison and ordered to pay over $115 million in restitution for orchestrating a massive $145 million healthcare fraud scheme. This case, which also resulted in a staggering $405 million asset forfeiture, highlights the severe consequences of exploiting vulnerabilities within federal healthcare programs and the lengths to which criminals will go to profit from them.
Nourian’s scheme centered around the fraudulent billing of the Department of Labor’s Office of Workers’ Compensation Programs (DOL-OWCP) for medically unnecessary compound creams. According to court documents, Nourian and his co-conspirators paid doctors millions of dollars in illegal bribes and kickbacks to prescribe these creams. The pharmacies, operated by Nourian, then billed the DOL-OWCP for exorbitant amounts, sometimes as high as $16,000 per prescription, for creams that cost them only around $15 to produce.
The press release from the U.S. Department of Justice reveals the shocking extent of the fraud. “Evidence at trial showed these compounds were being mixed in the back rooms of the pharmacies by untrained teenagers,” a stark illustration of the disregard for patient safety in favor of illicit profits. Patients who received the creams testified to their ineffectiveness and even reported painful skin rashes, further emphasizing the criminal negligence inherent in the scheme.
In less than three years, between May 2014 and March 2017, Nourian’s pharmacies billed the DOL-OWCP and Blue Cross Blue Shield over $145 million, receiving over $90 million in payments. Nourian then attempted to conceal these ill-gotten gains through money laundering and tax evasion, further demonstrating the sophisticated nature of his criminal enterprise.
“This 17-year sentence sends a clear message that our prosecutors, working shoulder-to-shoulder with our investigative partners, will identify, investigate, and prosecute even the most sophisticated fraud schemes that target taxpayer money and endanger patients,” stated Matthew R. Galeotti, head of the Justice Department’s Criminal Division.
The $405 million forfeiture, the largest ever obtained in a health care fraud case by the Department of Justice, underscores the commitment to recovering taxpayer funds and holding perpetrators accountable. “As a result of our tireless efforts, this defendant was tried, convicted, and ordered to forfeit more than $400 million – the highest forfeiture ever obtained in a health care fraud case in the Department’s history – and now his ill-gotten proceeds will be returned to the taxpayers and programs designed to care for our most vulnerable citizens,” Galeotti emphasized.
The Justice Department’s commitment to combating healthcare fraud is evident in the work of the Fraud Section’s Health Care Fraud Strike Force Program. With over 5,800 defendants charged and over $30 billion in fraudulent billings identified since 2007, the program plays a vital role in protecting taxpayer funds and ensuring the integrity of healthcare systems.
