Florida Man Pleads Guilty in Medicare Beneficiary Identifier Trafficking Case
The Department of Justice has announced one of its first prosecutions under the Medicare Access and CHIP Reauthorization Act of 2015 in a case involving the theft and sale of Medicare Beneficiary Identifiers.
The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) required the Centers for Medicare and Medicaid Services (CMS) to remove Social Security numbers from all Medicare cards as part of an effort to prevent fraud, combat identity theft, and safeguard taxpayer dollars and replace them with Medicare Beneficiary Identifiers. MACRA also made it illegal to buy, sell, or distribute Medicare Beneficiary Identifiers without proper authority.
In contrast to Social Security numbers, Medicare Beneficiary Identifiers cannot, by themselves, be used for identity theft; however, they can be used for medical identity theft. The recent prosecution of a Florida man shows these unique identifiers are being targeted and sold on the black market.
Charles William McElwee, 36, from South Florida, is a marketer and CEO of Lead Junkies LLC. McElwee was arrested on suspicion of involvement in a scheme to defraud Medicare and recently pled guilty to conspiring to buy and sell the Medicare Beneficiary Identifiers and other personally identifiable information of more than 2.6 million Medicare recipients in a $310,000 Medicare fraud scheme.
Get The FREE
HIPAA Compliance Checklist
Immediate Delivery of Checklist Link To Your Email Address
Please Enter Correct Email Address
Your Privacy Respected
HIPAA Journal Privacy Policy
AS part of the plea deal, McElwee pled guilty to one count of conspiring to violate MACRA and admitted that he and his co-conspirators used data mining and social engineering techniques to obtain Medicare Beneficiary Identifiers and other personal information that was subsequently advertised and sold online. The information obtained and trafficked included beneficiary names, addresses, dates of birth, Social Security numbers, and Medicare beneficiary identification numbers. Some of the co-conspirators included foreign actors, including individuals in the Philippines.
The case was investigated by the HHS-OIG in Miami, the FBI Miami field office, and was prosecuted by Assistant U.S. Attorney Jon Juenger. McElwee is due to be sentenced on April 7, 2023, and faces up to five years in federal prison.
