Miami Doctor Jailed In $6.5 Million Fraud
May 25, 1995
By ARDY FRIEDBERG Miami Bureau Chief
MIAMI — A Miami doctor was among 126 suspects arrested by the FBI in 31 cities on Wednesday during a nationwide insurance fraud crackdown dubbed "Sudden Impact."
Jesus N. Castillo, 57, of the 5200 block of Northwest Seventh Street, was charged with conspiracy to defraud private and government insurance programs through an elaborate scheme of staged auto accidents that generated $6.5 million for his medical clinics over four years.
Four of Castillo's employees, all of Miami and none of them doctors, also were arrested on Wednesday. Three other employees are being sought, the FBI said.
Those arrested were identified as Joaquin Garcia, 71, Francisco E. Alcantara, 53, Rogelio R. Cabrera, 35, and Juana Mercedes Mendez, 35. All are charged with insurance fraud. If convicted, they face from five to 25 years in prison and fines up to $250,000.
The investigation began in 1993 after the FBI determined that staged auto accidents were a significant element of insurance fraud throughout the country.
Since the investigation began, 273 people have been convicted or pleaded guilty to fraud charges.
The FBI used undercover agents and electronic surveillance during their investigation of Castillo, said agent Edmundo Guevara, of the agency's Miami office.
Investigators said Castillo, who operated two clinics in Dade County and one in Broward, used "runners" to recruit patients from accidents deliberately caused by his own employees. The patients were put through a battery of medical tests regardless of the need for the tests and the doctor filed false claims with auto insurance companies and Medicaid and Medicare.
"Dr. Castillo organized what we contend was an assembly line operation in a medical fraud factory," said Kendall Coffey, the U.S. attorney for the Southern District of Florida.
Three schemes were used to generate patients, Guevara said.
-- Paper accidents: A fake accident report filed to support insurance claims.
-- Caused accidents: Purposely sideswiping or stopping suddenly in front of a car to cause an accident.
-- Staged accidents: Using previously damaged cars that are brought to a location and made to appear as if they were involved in a fresh accident.
In all three schemes, patients were recruited by runners who were paid up to $300 for each patient they brought to Castillo's clinics. Francisco Alcantara was identifed by Coffey as a runner who made $40,000 in 1994 by bringing new business to Castillo.
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