Another defendant in American Senior Communities fraud case agrees to plead guilty

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Another defendant in American Senior Communities fraud case agrees to plead guilty
Another defendant in American Senior Communities fraud case agrees to plead guilty

Another defendant in the alleged $16 million fraud, kickback and money-laundering scheme involving former executives of American Senior Communities has agreed to plead guilty to charges against him, according to the Indianapolis Business Journal, citing a Tuesday filing in federal court.

Joshua Burkhart, the brother of the former ASC CEO James Burkhart, agreed to plead guilty to one felony count of conspiracy to commit mail, wire and healthcare fraud, according to the media outlet. In return, three other felony counts against him will be dropped.

A sentence was not specified, but the count carries a possible sentence of up to 20 years in prison.

Three other defendants in the case have pleaded not guilty to charges against them, and a trial in slated for January.

A 32-count indictment announced in October 2016 by the Justice Department accused Joshua Burkhart, James Burkhart, former ASC Chief Operating Officer Daniel Benson and Burkhart friend and associate Steven Ganote of pocketing more than $16 million in kickbacks and fraudulent overcharges, which they allegedly spent on vacation homes, private plane flights, golf trips, jewelry, gold bullion, casino chips and political campaign contributions.

Between 2009 and 2015, according to the indictment, the four men engaged in side deals with outside vendors for their own personal benefit, unbeknownst to, and at the expense of, Health & Hospital Corp. of Marion County (which owns facilities that it pays ASC to manage) and ASC's owners. Often, the indictment said, ASC and Health & Hospital Corp. were intentionally overcharged for products and services, and then the overcharges were funneled back to the men through a web of more than 20 shell companies. In other instances, according to the government, the vendors simply paid kickbacks to the men in exchange for doing business with ASC.

Joshua Burkhart, according to the plea agreement detailed by the Indianapolis Business Journal, received monthly checks for thousands of dollars from landscape company Mainscape beginning in 2009. The checks were said to cover consulting fees, although, according to prosecutors, Burkhart did not perform any consulting for the company.

Burkhart also reportedly earned money from selling flags to ASC facilities at inflated prices, at Benson's request.

In total, according to the plea agreement, Joshua Burkhart received more than $250,000 from the schemes with which he allegedly was involved.

Dave Mazanowski, founder of Mainscape, agreed to plead guilty to one felony count of conspiracy to commit mail, wire and healthcare fraud last year and formally entered his plea earlier this month. He resigned from his position with the company in October 2016, according to Mainscape.

In September, ASC sued both Burkharts, Benson and Ganote, as well as former Chief Financial Officer Roger Werner, alleging that they “systematically looted” the company of “tens of millions of dollars” over the course of seven years.

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