Two dockworkers for the Port of Long Beach (POLB) were arrested Monday on federal fraud charges that allege they caused two medical clinics to bill the union’s health care plan for chiropractic services that weren’t necessary or weren’t provided.
The workers, Downey resident Sergio Amador, 49 and San Pedro resident David Gomez, 52, were arrested without incident by federal authorities, according to a Department of Justice (DOJ) release issued Tuesday.
Both men pleaded not guilty at arraignments held Monday afternoon. They remain out, free on bond and are scheduled to stand trial on February 2, 2016. They are charged with 20 counts of mail fraud each, facing a maximum sentence of 20 years of mail fraud for each count of fraud.
Amador and Gomez were also members of the International Longshore and Warehouse Union (ILWU), Local 13, which represents dockworkers at the ports of Los Angeles and Long Beach and offers members benefits, including health care through the Pacific Maritime Association Welfare Plan.
According to the DOJ, the men opened a clinic in Long Beach in 2009 under the name “Port Medical,” purporting to provide chiropractic services. Shortly after, they opened another clinic under the same name in San Pedro, in addition to creating medical management companies to use the funds generated by the medical clinics.
The indictment states that such funds were used to pay the workers and to directly incentivize those on the Welfare Plan to use Port Medical’s services, including cash payments and sports team sponsorships. In all, Port Medical received $225,000 from the Welfare Plan, which used forged signatures and other methods to falsely indicate Welfare Plan members had received chiropractic services.
The indictment also alleges Port Medical encouraged members of the Welfare Plan to seek massages, heat and ice treatments when not medically necessary.
This indictment was a product of an investigation by the U.S. Department of Labor, Office of the Inspector General, Office of Investigations, the U.S. Department of Labor, the Employee Benefits Security Administration and the Federal Bureau of Investigation.