March 7, 2013

http://www.radioiowa.com/2013/03/07/arizona-men-face-charges-in-alleged-keokuk-money-laundering/

The owners of a couple of care facilities in Keokuk are facing a potentially hefty fine for alleged money laundering and fraudulent Medicaid claims. The Iowa Attorney General’s office has filed a civil lawsuit in Lee County District Court seeking damages of more than $17 million.

The suit alleges Alan Israel and his son Jason Israel – both of Phoenix, Arizona – engaged in a money laundering scheme as owners of the Lexington Square care facility in Keokuk and Dave’s Place, a specialized nursing facility in Keokuk. According to the lawsuit, the defendants made false statements and claims resulting in Iowa’s Medicaid program reimbursing the Israels substantially more than they were entitled to.

The alleged improper expenses submitted to the Iowa Medicaid program included airline and train travel, hotel rooms and payments for an employee’s camper. A release from the Attorney General’s office indicates the case is unique because it’s the first civil lawsuit filed under the Iowa False Claims Act, which allows the state to seek enhanced penalties.