Owner of Cosmetic Clinics in California Admits $20M Insurance Fraud

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The former owner of a group of health spas and clinics in Los Angeles has admitted to participating in a $20 million insurance fraud scheme involving Botox injections, laser hair removal and other procedures, federal prosecutors said.

Roshanak Khadem, 54, pleaded guilty Tuesday to one count each of conspiracy to commit health care fraud and subscribing to a false income tax return, the U.S. Attorney’s Office said in a statement.

Khadem’s facilities in the San Fernando Valley included R&R Med Spa, Nu-Me Aesthetic and Anti-Aging Center.

Patients at her businesses were asked to provide their insurance information, even though Khadem and her staff knew the cosmetic procedures would not be covered, the statement said.

Staff told the patients they could get “free” or discounted procedures based on “credit” they would earn. A portion of the payments from insurance companies would then be calculated for the “credit” that the patients could use at the clinics, according to prosecutors.

Khadem masterminded the scam and submitted over $20 million in false claims along with four other co-defendants, according to prosecutors.

She faces up to 13 years in prison when she’s sentenced in June.