Phase I Charges Filed on 10 Attorneys and 6 Cappers in Massive Multi-Million Dollar Workers' Com
Largest number of attorneys charged in one case in Orange County history.
SANTA ANA, Calif. - Ten attorneys and six cappers were charged today for participating in a massive multi-million dollar workers' compensation insurance referral scheme that exploited persons in predominantly Spanish speaking communities. This is the first phase of filing resulting from a 3-year insurance fraud investigation by the Orange County District Attorney's Office (OCDA) Bureau of Investigation, Insurance Fraud Unit with assistance from the California Department of Insurance (CDI).
Charges were filed today, June 5, 2017, for multiple felony counts of:
Conspiring to refer clients for compensation
Referring patients/clients with reckless disregard for commission of fraud
Aggravated white collar crime over $500,000.00
Loss over $1,300,000.00
Maximum sentences range from seven years to twenty-five years and eight months in state prison.
John Woods, 56, Cypress, State Bar #181388
Payman Zaragi, 49, Sherman Oaks, State Bar #208451
John Jansen, 49, Santa Ana, State Bar #182405
Fari Rezai, 39, Irvine, State Bar #195149
Lionel Eduardo Giron, 49, Pomona, State Bar #200450
Dennis Ralph Fusi, 73, Lakewood, State Bar #70905
Jorge Humberto Reyes, 39, Los Angeles, State Bar #232350
Rony M. Barsoum, 43, Los Angeles, State Bar #231843
Robert Irving Slater, 67, Encino, State Bar #67572
Robin Jacobs, 52, Sherman Oaks, State Bar #167089
Individual complaints specifying charges for each defendant are available upon request to the Orange County District Attorney's Office.
Carlos Arguello III, 35, Tustin (Maximum Sentence: 29 years and 8 months in state prison)
Edgar Gonzalez, 50, Anaheim (Maximum Sentence: 20 years and 8 months in state prison)
Boris Mikhayovich Dadiomov, 31, San Diego (Sentence not specified)
Soraida Veronica Castro, 42, Imperial Beach (Sentence not specified)
Tania Arguello-Plasencia, 31, Tustin (Sentence not specified)
Dulce Gallegos, 30, San Ysidro (Sentence not specified)
In 2005, Carlos Arguello III is accused of forming Centro Legal Internacional, an "advertising" company, and securing unlawful referral contracts with 20 to 40 workers' compensation insurance and personal injury attorneys. Arguello is accused of requiring all participating attorneys to sign annual contracts for his "joint advertising program." Defendant Arguello is further accused of creating contracts that specified a monthly fee and named the marketing service provider as Centro Legal Int'l, Justicia Legal Int'l, or Centro de Abogados Int'l, which were owned by Arguello and operated by his associates. Arguello is accused of requiring the attorneys to use several other companies owned or controlled by Arguello and Edgar Gonzalez, including: USA Photocopy, C & E Technology, Professional Document Management, and Providence Scheduling.
Arguello and Gonzalez are accused of being the masterminds behind the unlawful referral network.
Defendants Tania Arguello Plasencia, Boris Mikhayovich Dadiomov, Soraida Veronica Castro, and Dulce Gallegos are accused of working and capping for Arguello.
How the Referral "Mill" Worked
The defendant attorneys in this case are accused of paying a monthly fee for the Cappers to procure and deliver an agreed upon minimum number of retained clients per month. Cappers are accused of distributing flyers and business cards in predominantly Hispanic neighborhoods, businesses, swap meets, and the U.S.Mexico
border. Cappers are further accused of publishing advertisements in Spanish language publications and using misleading websites offering legal services, including:
Each website and advertisement offered a "free consultation" via an online consultation form or a toll-free number. The toll-free numbers for Centro Legal Int'l, Justicia Legal Int'l, and Centro de Abogados were all directed to a call center in El Salvador. Once a caller showed interest in signing up, Cappers are accused of dispatching a recruiter, who acted as an agent from the subscribing law firm, to the caller's home within 24 to 48 hours to obtain the applicants' signatures on an intake packet, numerous blank documents, and an attorney retainer agreement, without any contact with or input from the assigned attorney. Cappers are further accused of forwarding the completed intake packet to participating attorneys and medical providers within the referral network. In addition to paying monthly "marketing" fees, the attorneys involved in the scheme are accused of using copy services owned or controlled by Cappers and authorizing staff from various copy companies run by the cappers to inspect the attorneys' client files for information to prepare copy service orders for subpoenaing records.
The attorneys are accused of permitting Cappers to order, prepare, and submit documents on behalf of the attorney without attorney oversight or approval in violation of law.
On the medical provider side, individual medical providers are under investigation for paying for patients recruited by the Cappers, and then prescribing durable medical equipment and pharmaceutical goods through vendors, and referring diagnostic imaging requests to companies chosen by the Cappers. In 2014, the OCDA received a tip from a major insurance carrier and initiated an investigation in conjunction with CDI, which led to the investigation into the unlawful referral scheme.
As there will be other phases, the OCDA and CDI will not be providing further details at this time.
The Law Business & Professions Code § 6152 prohibits individuals or businesses from procuring clients (aka "capping") for attorneys or law offices. Likewise, Insurance Code § 750 and Labor Code § 3215 also prohibit attorneys from paying cappers for referred clients. Insurance Code § 750 and Labor Code § 3215 also prohibit copy service companies from offering any type of consideration to attorneys in exchange for the referral of business. Moreover, conspiring to illegally refer or pay for clients and hiding the capping from the insurance company in order to obtain benefits is further prohibited by Penal Code §§ 549, 550(a)(1), and 550(b)(3). The Orange County District Attorney's Office Bureau of Investigation investigated this case with the assistance of the California Department of Insurance. Prosecutor: Deputy District Attorney Noor Hasan, Insurance Fraud Unit