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Attorney General Lockyer Announces $2.9 Million in Restitution, Prison Sentence for Medi-cal Fraud

Case Raises Amount of Court-Ordered Restitution and Fines to $100 Million Since 1999
Tuesday, October 21, 2003
Contact: (415) 703-5837

(LOS ANGELES) – Attorney General Bill Lockyer today announced an investigation into a major Medi-Cal fraud case has resulted in a three-year prison sentence and court-ordered restitution of $2.98 million. The sentence raises to more than $100 million the amount of court-ordered restitution and civil penalties in Medi-Cal fraud prosecutions brought by Lockyer since he took office in 1999.

"Medi-Cal fraud hurts us all, from the taxpayers who foot the bill for health care for California's poorest citizens, to the Medi-Cal patients, who face reduced services and limited eligibility every time the state is forced to cut funding because of budget deficits," Lockyer said. "Far too often, we see greedy criminals who use unwitting patients to fraudulently line their own pockets, hampering our efforts as a society to help those most in need."

During the five years Lockyer has been Attorney General, the number of criminal Medi-Cal fraud cases filed has increased 194 percent and convictions have increased by 128 percent. The amount of court-ordered restitution rose more than 353 percent, compared to the five years prior to Lockyer's administration.

In September, Lockyer obtained the longest criminal sentence for Medi-Cal fraud in California history. Surinder Singh Panshi, 54, of South Orange, New Jersey, was sentenced to 16 years in prison and ordered to pay $2.5 million in restitution to the state and $124,000 in back taxes to the Franchise Tax Board (FTB). Lockyer has obtained close to 400 criminal convictions in Medi-Cal fraud cases, compared to 170 convictions during the five years before he took office.

The most recent sentence, which pushed the BMFEA's monetary recovery for Medi-Cal fraud over the $100 million mark, was obtained against Mila Sigal, 51, of Woodland Hills. Sigal owned and operated L&M Diamond Jewelry Optical in West Hollywood, from 1993 to 2001. According to the complaint, she and her husband, David Sigal, 56, bilked Medi-Cal of $2.98 million by filing false claims for eyeglasses they said were replacements for Medi-Cal patients whose eyeglasses were lost, stolen or destroyed.

The investigation revealed the Sigals used personal information about 6,341 unwitting Medi-Cal beneficiaries to fraudulently bill Medi-Cal for 59,574 pairs of unnecessary eyeglasses from 1995 to 2001.

The investigation began in March 2001, when the Department of Health Services (DHS) notified the Attorney General's Bureau of Medi-Cal Fraud and Elder Abuse (BMFEA) that responses to a survey sent to Medi-Cal beneficiaries indicated several had not received the eyeglasses that were billed in their name by L&M Diamond Jewelry.

The BMFEA investigation uncovered numerous cases in which the Sigals billed Medi-Cal for dozens of eyeglasses in a little more than a year, but the patients whose names were used said they had only received a couple of pairs during that period. Typical was one beneficiary whose name was used to bill Medi-Cal for 12 pairs of eyeglasses lost between June 1999 and December 2000. The beneficiary reported he had received two pairs of eyeglasses within the last two to three years, and that he had never had his glasses stolen.

L&M Diamond Jewelry Optical shut down in early June 2001, shortly after the BMFEA served search warrants at the business and the Sigals' residence. Criminal charges were filed later that month, charging the Sigals with one count of conspiracy, one count of grand theft of more than $2.5 million and 62 counts of presenting false Medi-Cal claims. Prior to trial, both defendants pleaded guilty to one count of presenting false Medi-Cal claims and one count of grand theft of more than $50,000.

Due to David Sigal's limited role, he was sentenced in June 2002 to five years of probation and 100 hours of community service. Los Angeles Superior Court Judge David M. Mintz on Friday sentenced Mila Sigal to three years in state prison and ordered her to pay $2.88 million in restitution, noting she previously had paid $100,000 in restitution. David Sigal was ordered jointly liable for the $2.88 million restitution.

In 2001, Lockyer's Bureau of Medi-Cal Fraud and Elder Abuse received special recognition from the U.S. Department of Health and Human Services, Office of Inspector General, for being the nation's premiere state prosecutorial agency in the battle against health care fraud and elder abuse.

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03-128CAvMS.pdf466.55 KB
03-128Fraud.pdf57.16 KB
03-128Rest-Rec.pdf35.17 KB
03-128Rest-Rec.pdf35.17 KB
03-128Fraud.pdf57.16 KB
03-128CAvMS.pdf466.55 KB

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