The Department of Justice (DOJ) is charging a woman with a long-running health care fraud: From 2017 to 2021, she billed a health insurer for sexual services offered to longshoremen at her California “spas.”
Sara Victoria, the “leader” of the program, hired women through Long Beach strip clubs and referrals to perform the services at her three chiropractic and acupuncture businesses. Federal prosecutors are also charging eight other people, including seven dockers, for allowing her to submit the false claims to the International Longshore and Warehouse Union-Pacific Maritime Association (ILWU-PMA) health plan in exchange for sexual services.
According to her consent form, Victoria billed health insurance — which covered chiropractic services with no deductible or deductible — for chiropractic and physical therapy using the dockers’ names or the names of their family members for $2.1 million in fabricated claims. In exchange, Victoria paid cash kickbacks to members of the ILWU-PMA plan and facilitated the operation through encrypted speech in text messages, court documents said. She eventually raised around $550,000.
The ILWU said in a press release that it “denounced fraudulent claims allegedly made by seven workers and three healthcare providers against its ILWU PMA welfare plan.”
“Our union is proud to have negotiated with our employer for health benefits that we believe all Americans should have. We will not tolerate fraudulent use of the benefits in our contract that longshoremen have fought and sometimes died for over the past 90 years,” ILWU Coast Committeeman Frank Ponce De Leon said in the statement.
Victoria admitted to using another person’s identity without their consent while fraudulently billing and was charged with “one charge of conspiracy to healthcare fraud and one count of aggravated identity theft”. The DOJ reports that if Victoria pleads guilty in court, she could face 12 years in federal prison.
Another accused is Cameron Rahm, a longshoreman, ILWU member and alleged customer of Victoria’s company. The DOJ alleges that he agreed to let them make the false claims and lied to FBI agents about it.
It’s not the first time the dockers’ union has been implicated in a fraudulent insurance claims scheme.
In 2019, another ILWU-PMA plan chiropractor, Darren Hines, pleaded guilty to healthcare fraud. He had billed the plan for services under another provider’s name and for services that were not medically necessary.
In 2016, David Gomez and Sergio Amador were convicted of mail fraud for performing an operation that billed the ILWU-PMA plan for services that were not rendered or medically necessary. Again, this was largely through chiropractic care.
Gomez and his partner opened clinics and formed medical management companies, through which they channeled funds from the clinics to themselves and paid ILWU members to use their clinics. Again, they used false signatures and names of ILWU family members to make fraudulent claims about the plan. Gomez made about $3 million from the program and was sentenced to 20 years in prison.
In 2013, fraudulent applications to the same union benefit plan contributed to a backlog of more than 100,000 applications. Slow processing times for claims by the plan administrator resulted in some workers’ medical claims going into collection. This in turn led to demonstrations by union members and a labor shortage.