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A federal grand jury issued subpoenas today to several of the biggest names in Las Vegas, including prominent doctors and lawyers. As Eyewitness News first reported last week, the FBI is investigating an allegedly massive insurance fraud conspiracy. George Knapp of the I-Team broke the story and has the exclusive update.
The FBI has been investigating questionable relationships between doctors, lawyers, and middlemen to find out if money is changing hands illegally.
The FBI has been investigating this for two years. In Nevada, it isn't illegal for doctors to refer patients to lawyers, but it certainly would be wrong if lawyers then split their fees with the doctors, or if they all worked together to jack up the medical bills of injured people. Subpoenas landed at law offices and medical offices Tuesday, and the shock waves can still be felt rumbling through town.
At least five local doctors were served with a subpoena. The federal grand jury and U.S. Attorneys office are looking for information about what if any financial relationships exist between at least 17 local doctors and several of the best known personal injury lawyers in town.
A two-year FBI investigation has reportedly focused on a Vermont businessman named Howard Awand. His company Nevada Medical Consultants acts as a middleman between doctors and lawyers. The company and sub-companies set up numerous medical appointments for injury victims, then arranges for legal representation. These are bills submitted by Awand to one law firm, he charges hundreds of dollars for writing a letter, hundreds more for setting up meetings.
Cynthia Johnson's 2002 auto accident led her to Awand, who set up appointments for her with eight different doctors and with attorney Bob Vannah. Johnson had so many doctors she found it tough to keep track.
"My receptionist, she was logging on her calendar when I would leave for appointments, and one day I'm leafing through and I go oh my God, I can't remember which doctor is where and who and what day," said Cynthia Johnson.
The FBI is curious whether the doctors and lawyers, who allegedly worked together padded medical bills with unnecessary procedures, even unneeded operations. Agents wonder if doctors acted as expert witnesses to help the lawyers get larger settlements, a percentage of which was allegedly returned to the doctors under the table. The Nevada Insurance Council says it happens, and it adds up to hundreds of millions of dollars each year.
"For sure it's excessive types of treatment and the Attorney General's office tells us whenever something is excessive, they consider it to be fraudulent. You can call it whatever you want but what we've got here is a lot of trumped up whiplash claims," said Bob Feldman, Nevada Insurance Council.
The subpoenas asked for financial information about Howard Awand and his companies, as well as information about any connections between the doctors and the following lawyers: Robert Vannah and his partners, Randall Mainor and his partners, Eglet and Cottle, Richard Harris and partners, Dennis Prince, Weiss and Weiss, and Gage and Gage.
The U.S. Attorney will not release names of doctors who were subpoenaed, but the Eyewitness News I-Team has learned many of the names of interest to investigators, including the following doctors: Kabins, Kraft, Dunn, McNulty, Peoples, Leon, Lempert, Thomas, Oliveri, Prader, and Iglekowski. There are other names as well. We cannot confirm that all of these received subpoenas but some did.
One attorney, Bob Vannah, called Eyewitness News on Tuesday evening to say he knows nothing about any fee splitting with doctors and thinks anyone who does that should be caught and punished.
A well-placed source told us the doctors and lawyers who received subpoenas are only subjects of an investigation not targets, meaning, the U.S. Attorney wants information from them, at least, for right now.
So far there is no comment from Howard Awand. The number for his Nevada Medical Consultants office has been disconnected. He owns a home in southern Nevada but lives in Vermont so Eyewitness News will try to contact him there.
He's pretty well known among doctors and lawyers in Las Vegas and also helps raise a lot of money for local judges reelection campaigns, which is something else the FBI is interested in.