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Wednesday, January 01, 2020

Former Sacramento CEO Sentenced to 5 Years in Prison for Health Care Fraud Scheme

Overbilled the VA for Prescription Shoes and Lied to Win National Contract

SACRAMENTO, Calif. — Peter Wong, 61, founder and former CEO of Sunrise Shoes and Pedorthic Service Corporation, was sentenced Tuesday by U.S. District Judge John A. Mendez to five years in prison for health care fraud and conspiracy to commit wire fraud, U.S. Attorney McGregor W. Scott announced.

According to court documents and evidence presented at trial, between March 2008 and Feb. 2015, Wong and Anthony Lazzarino, 69, former Chief of Podiatry for the Veterans Affairs’ (VA) Northern California Health Care System, engaged in a scheme to defraud the VA by billing for custom work and services that were prescribed but not supplied in shoes delivered to veterans. In addition, they and Wong’s former employee Jai Aing Chen, who separately pleaded guilty on Dec. 6, 2016, agreed to make materially false statements to the VA regarding where the shoes were manufactured, in the course of applying for a national contract worth over $11 million per year. A federal jury found Wong and Lazzarino guilty of health care fraud and conspiracy to commit wire fraud on May 17, 2019.

This case is the product of an investigation by the Department of Veterans Affairs Office of Inspector General, Department of Veterans Affairs Police Service, Homeland Security Investigations, and Federal Bureau of Investigation. Assistant U.S. Attorney Lee S. Bickley is prosecuting the case.

Lazzarino is scheduled to be sentenced by Judge Mendez on Feb. 11, 2020. He faces a maximum statutory penalty of 10 years in prison and a $250,000 fine for each health care fraud count, and five years in prison and a $250,000 fine for the wire fraud conspiracy count. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. Mendez sentenced Chen to one year and one day in prison on Aug. 6, 2019.

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