Hospital Owner to Plead Guilty to New Charges Related to $950 Million Fraud Scheme

The former owner of a Southern California hospital imprisoned for his role in a $950 million fraud scheme has agreed to plead guilty to new charges after being accused of hiding $1 million earned by selling luxury cars, federal prosecutors said Wednesday.

Michael D. Drobot defied a court order that he forfeit the profits from the sale of the 1965 Aston Martin, 1958 Porsche, and 1971 Mercedes-Benz, according to prosecutors. He is charged with wire fraud, engaging in monetary transactions in property derived from unlawful activity, and criminal contempt of court, the U.S. Attorney's Office said in a release.

He's expected to plead guilty when he's arraigned in the coming weeks, prosecutors said. An effort to reach a lawyer for Drobot, 74, was not successful.

Drobot was sentenced in 2018 to more than five years in prison and ordered to forfeit $10 million for bilking the government while he owned Pacific Hospital in Long Beach. He pleaded guilty to conspiracy and paying illegal kickbacks.

Prosecutors in that case said Drobot paid $50 million to doctors and other medical professionals who referred patients to his hospital for spinal surgeries.

Some patients lived hundreds of miles away.

State and federal workers compensation insurers were billed hundreds of million dollars as part of the scheme over 15 years, investigators said.

Prosecutors have charged 17 individuals and obtained 10 convictions in the kickback scam.

Drobot is serving his time at Taft Correctional Institution in Kern County, California. He could face a maximum sentence of 50 years in the new case.

Copyright AP - Associated Press
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