Feds: Kickbacks fueled $23M fraud
Chiropractors gave crash victims costly treatment
When the feds started scrutinizing two men accused of running a massive $23 million auto insurance fraud at chiropractic clinics in South Florida, their defense attorneys say investigators had a theory the ringleaders were part of the Russian mob.
The two men, arrested this month, had much in common — they emigrated from Ukraine and became U.S. citizens more than 20 years ago, settling into South Florida’s Orthodox Jewish community.
Felix Filenger was the flashy one who drove a Bentley, bought a $64,000 watch and carried a black suitcase stuffed with cash he doled out as kickbacks, according to the feds.
Andrew Rubinstein, aka Andrei Rubinsteyn, was the quiet one, and so far, little information has emerged about him. His attorney said Rubinstein is a widower who is raising his 15-year-old daughter alone since his wife died from a stroke a year ago.
Prosecutors did not charge either man with being involved in the Russian mob. They’ve never even hinted publicly that it had
been part of their investigation.
But Filenger’s attorney Michael Tein said in court last week that authorities had initially investigated the alleged fraud as if it were an organized crime case.
On Friday, he told the Sun Sentinel his client will fight the fraud charges.
“The government spent years and millions of taxpayer dollars wiring up witnesses and tapping phones thinking these clinics were a front for the Russian organized crime network,” Tein said. “As it turned out, they were dead wrong, but after spending all that time and taxpayer money, it’s perfectly understandable that they felt compelled to save face and bring some charges.”
The feds allege the men ran a highly profitable crime ring of corrupt clinic owners, chiropractors and lawyers that operated mostly in Broward, Palm Beach and Miami-Dade counties. Prosecutors say it was an elaborate operation that — by conservative estimates — defrauded more than $23 million from 10 auto insurance companies between 2010 and this year.
Filenger, 41, of Sunny Isles, and Rubinstein, 48, of Miami, are jailed on charges of racketeering and mail fraud conspiracies, wire fraud, health care fraud, and making false statements. If convicted, they could face 20 years or more in federal prison, prosecutors said.
Investigators said the men paid kickbacks of $500 to $2,100 — per patient — to tow truck drivers and body shop workers who agreed to illegally steer accident victims to chiropractic clinics, which were secretly owned by Filenger and Rubinstein.
Federal agents used wiretaps and cooperating witnesses to record conversations and plowed through medical and financial records in an investigation that went on for several years.
When the men realized they were under criminal investigation, federal agents said they began investing in a kosher bagel shop in North Miami Beach to try to conceal and protect their cash and other assets.
Prosecutors say this is how the fraud operated:
Filenger and Rubinstein recruited tow truck drivers, body shop workers and other people who had access to supposedly confidential traffic crash reports. Their job was to refer drivers or passengers who were involved in a crash to the chiropractic clinics.
These so-called “runners” were paid illegal kickbacks to solicit accident victims to seek unnecessary treatment at the clinics, according to the charges.
Investigators said Filenger and Rubinstein took over failing and troubled clinics and concealed their ownership by having chiropractors and others register the practices in their names. Filenger had an office in two of the clinics in Sunrise and North Miami, investigators said.
The defendants then told the doctors and chiropractors what treatments they wanted performed, based on the financial return and not the medical need, investigators said. Medical professionals who wouldn’t “play ball” were fired, prosecutors said.
Some attorneys also paid kickbacks of $2,000 per patient for the clinics to refer patients to them so they could file bodily injury lawsuits on the patients’ behalf, investigators said.
Prosecutors say the fraud involved rapidly running up the medical bills by requiring patients to get a lot of treatments — the goal was 30 visits each — and expensive tests in a short period of time. The fraud took advantage of no-fault provisions in Florida’s Personal Injury Protection insurance (PIP), which requires auto insurance providers to pay up to $10,000 for emergency treatment, authorities said.
The patients’ records all indicated they had an “emergency medical condition” and a documented pain level of 7, 8 or 9 — the high end of the scale — regardless of what they had reported to staff, prosecutors said.
Patients were told to show up for a lot of appointments — five sessions a week for the first couple of weeks, then three per week for a while. Many were ordered to undergo unnecessary and painful nerve tests that cost about $1,000 each and others were sent for unnecessary MRIs, according to investigators.
Clinic staff were told to give all patients a “goody bag” containing neck braces and other medical equipment “whether they need it or not” to run up costs, investigators said.
If patients balked, saying they weren’t benefiting from the treatment or didn’t have time for so many appointments, an attorney or someone else would be assigned to tell them they had to do it if they wanted to try to collect money by filing a lawsuit or insurance claim. Though no patients were criminally charged in the indictment, investigators suggested some of them may have tried to claim compensation for their supposed injuries.
Tein said his client helped make the clinics profitable by running the business side and let the doctors and chiropractors handle the medical side.
In one of many conversations secretly recorded by the feds, one of the chiropractors fretted about what would happen if an insurance company became suspicious and sent an undercover patient or “plant” into the clinics.
Prosecutors referred to the clinics as “PIP mills,” likening them to the pill mill clinics that recently plagued South Florida and made massive profits by illegally dispensing pain pills to drug dealers and “patients” who then sold the drugs on the street.
In related and similar cases, state prosecutors have filed criminal charges against several attorneys and people who illegally recruited patients for the chiropractic clinics.
Federal prosecutors said some of the people facing state and federal charges are cooperating and are expected to testify against Filenger and Rubinstein.
One “runner” told investigators he had referred about 750 “patients” to the corrupt clinics and that he was paid as much as $2,000 per referral, they said. He estimated he was paid more than $1 million, much of it in cash, over several years.
Rubinstein has agreed to remain locked up, for now.
Filenger, who last week filled the courtroom with more than 35 supporters, including several rabbis, failed during a hearing to persuade a judge to release him. Prosecutors said they were concerned about his concealed assets and his frequent travel and strong connections to Ukraine and Israel.
The judge ruled the risk was too high that Filenger might flee prosecution.
“I would be rather surprised, under these circumstances, if this defendant could resist the temptation to flee,” U.S. Magistrate Judge Lurana Snow said in her ruling.
Filenger told court officials he had no assets and no liabilities but said he earned $100,000 a year from the bagel shop.
“He is moving his money around ... it looks to me, to try to hide it,” FBI Agent Ira Fair testified during the court hearing.
Prosecutors accused Filenger of deliberately hiding his assets, property, cash and luxury items by placing them in trusts or in his wife’s and mother’s names. He began doing so after federal agents first searched one of his properties in 2015, authorities said in court.
They said he used to own and drive several Bentleys, at least one of which he told witnesses was held under his mother’s name but really belonged to him. Filenger also bought a $64,000 rose gold Juan Pablo Montoya watch, more than $80,000 worth of designer bags and costly jewelry for his wife and himself, they said.
Filenger received hundreds of thousands of dollars from the clinics, including $591,000 from two clinics in Hollywood and Sunrise between 2010 and 2015, prosecutors said. They said he also transferred $500,000 to what appears to be an asset protection or estate planning law firm.
Tein said his client did nothing wrong but took steps to try to protect his family in case his accounts were frozen by the government. Filenger was driving a 2014 Toyota Camry in the months before he was arrested, the lawyer said.
Tein and Rubinstein’s attorney, Marc Seitles, both said they think prosecutors are “overreaching” by filing federal racketeering charges against the men.
“It’s simply over the top,” said Seitles.