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Businessman pleads guilty to Medicare fraud

Posted September 8, 2009

— A Raleigh man who federal investigators say was at the center of an operation that pocketed more than $12 million from false Medicare claims pleaded guilty Tuesday to fraud.

Kalu Kalu pleaded guilty to one count each of conspiracy to commit health care fraud and health care fraud. He will be sentenced Dec. 14, when he faces up to 15 years in prison.

Feds allege couple stole $13M in Medicare claims Medicare fraud probe nets second plea

Kalu, his wife, Kecia Kalu, and two others indicted in the case would recruit and train salespeople to establish relationships with Medicare patients to obtain their Medicare numbers and personal information, according to federal investigators.

Investigators allege that the couple used the Medicare provider number of co-defendant Martin Ifeani Iroegbu to submit bogus claims for scooters. The Kalus also are alleged to have used their Raleigh businesses, Enuda Healthsource and Universal Medical Supplies, to bill Medicare for health care aids that were never provided to beneficiaries.

As part of a plea agreement, 15 counts of health care fraud will be dismissed against Kalu Kalu when he is sentenced, defense attorney Paul Sun said.

"Consistent with this plea agreement Mr. Kalu is cooperating fully (with authorities)," Sun said.

Iroegbu has already pleaded guilty to health care fraud and aiding and abetting. He is expected to begin serving a 26-month prison sentence in November.

Kecia Kalu is scheduled for arraignment on Sept. 28.

The fourth defendant in the case is Nnenna K. Cornett, who operates States Medical Products LLC in Raleigh. She faces 16 counts of health care fraud and one count of conspiracy to commit fraud, but it's unclear whether she has been arrested.

The U.S. Department of Health and Human Services Office of the Inspector General reported in May that more than 10 percent of the $920 million Medicare paid in 2005 for powered wheelchairs had been misspent.

"This goes on all over the country. It's taking money from the taxpayers," Sun said.

To report Medicare fraud, call the state Department of Insurance weekdays at 800-443-9354.


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  • Myword Sep 8, 2009

    I will just say ditto to lorivalentine1's comments.

  • Tired Of Excuses Sep 8, 2009

    Notice how the there's always reference when discussing a public government option to medicare? Never medicaid...gee I wonder why?

  • lorivalentine1 Sep 8, 2009

    Seriously.. just heard on the new this guy lives in a 6800 sq. ft house... What a piece of work. How can any decent person prey on the elderly like that?? and to top it off the rest of us are paying for these pieces of work to live in their giant house. Hope we throw the book at them and take everything they own to pay back Welfare so the right people get their benefits.

  • Tired Of Excuses Sep 8, 2009

    What??? Take advantage of and defraud MEDICAID??? ( another fine government healthcare program) Nooo....say it isn't so.

  • woodrowboyd2 Sep 8, 2009

    this must be a new goverment program crafted by Axelrod
    it replaced meals on wheels with money on wheels

  • ccs1920 Sep 8, 2009

    Are all these people out on bond? If so, I wonder how many will be around when it's time to report to prison.

  • concerncitizen Sep 8, 2009

    superman, it's good you don't understand how it could happen. You're not trying to commit fraud? These people went through a lot of effort not get caught by a simple letter. The article gives us an idea how many people it took to carry out the fraud! Probably if they had stopped at 6 million dollars they might never have been caught? 12 million is to hard not to miss, in a down economy? We'll never know what actually got them caught?

  • ThisIsMyName Sep 8, 2009

    People in some level of power will usually take advantage of others. You gotta love our society!

  • djofraleigh Sep 8, 2009

    How much money is the government going to get back?

    What is wrong with government not being able to handle our money. I know, I know, the percentage found here is very small, but there is nothing small about $12 million. That's over 10,000 chairs. Are the manufacturers complicit? did't the government check with the sellers of the chairs to see if they sold as many as the government paid for.
    Some government officials responsible should be losing their jobs.

  • whatusay Sep 8, 2009

    So I can steal $12 million, and spend only 2 years in jail...where do I sign up?