Twenty-one people are facing charges as part of a vast hospice fraud scheme that prosecutors say defrauded California’s medical system of $267 million.
Atty. Gen. Rob Bonta announced the results of the investigation he convened on Thursday. operation skip trace. Five key conspirators were arrested on suspicion of multiple felonies, including insurance fraud, money laundering, conspiracy and identity theft, for their alleged role in a sophisticated hospice scam operating in Southern California.
If found guilty, each could face at least a decade behind bars.
State prosecutors allege that the defendants purchased personal identifying information of non-California residents on the Dark Web and, without their knowledge, enrolled them in Medi-Cal through Covered California. According to the criminal complaint, the defendants bought the hospice companies and began billing the state for services they never provided.
“Throughout the lifetime of this fraudulent scheme, not a single legitimate hospice service was provided, yet millions were billed in a brazen, calculated scheme that exploited the Medi-Cal system,” Bonta said. “This was not a mistake or a loophole; this was intentional fraud. This kind of abuse undermines trust, drains vital resources, and threatens the care of those who truly depend on it.”
Prosecutors say Robert Sabiron Rubilar, chief executive officer and chief financial officer of Legal Systems Billing Solutions, and Lizelle Rubilar masterminded the scheme. The pair were arrested along with three other people on Wednesday as state investigators served search warrants at 10 locations in Southern California.
According to a criminal complaint, she is charged with conspiracy and insurance fraud for allegedly submitting fraudulent claims to Medi-Cal for Cherish Hospice Inc., Emanuel Hospice and Azure Hospice Care Inc.
In another criminal complaint, which also names the couple, 16 other people are charged with conspiracy to commit insurance fraud, identity theft and health insurance fraud. In that complaint, prosecutors say Levon Darachyan and Roberto Rubilar Jr. used fictitious patients to solicit hospice payments from the federal government for JTN Hospice, Medlight Hospice, LED Hospice, Beloved Hospice Care, Hope of LA Hospice, Sunset Hospice, Secured Hospice and TC Hospice.
According to the criminal complaint, the group deposited government funds into the bank accounts of other conspirators charged in the case, including $33 million in the bank account of Sarkis Kasachikyan. Prosecutors allege that a wide range of fronts were used in the conspiracy, and hospice locations were often not brick-and-mortar facilities.
“Once the money was paid, it was funneled through a complex web of more than 130 shell companies and hidden in bank accounts, payment apps and cryptocurrencies to avoid detection,” Bonta said.
The attorney general said state officials have recovered more than $30 million in state funds from the scheme.
The charges are the latest in a series of high-profile steps taken by state and federal prosecutors as both have stepped up their investigations into hospice operators. President Trump and his administration have tried to portray California, and especially Los Angeles County, as a hotbed of hospice fraud.
Last week, federal authorities arrested eight people and charged 15 in an alleged scheme to steal more than $50 million in health care funds by running sham hospice facilities in Southern California.
Bonta said Thursday that federal officials are also taking action in Georgia, Texas and Ohio, noting that hospice fraud is occurring across the country.
“To claim that this is a problem specific to California is ridiculous,” he said.
