Long Beach dockworkers billed union health insurance for sexual services, prosecutors say
Eight workers at the Port of Long Beach, a business owner and one of her employees were charged this week in federal court in connection with a scheme to fraudulently bill the dockworkers union’s health plan for sexual services and falsified physical therapy claims, prosecutors said.
All of the defendants except for one dockworker submitted plea agreements. The alleged ringleader, 46-year-old Sara Victoria of San Pedro, admitted in her plea agreement to owning three businesses between 2017 and 2021 that provided sexual services as well as chiropractic and acupuncture treatments.
Knowing that the health insurance provided by the International Longshore and Warehouse Union – Pacific Maritime Assn. generally covered all chiropractic services without a deductible, copay or out-of-pocket expenses, prosecutors said, Victoria offered the dockworkers cash kickbacks or sexual services for them and their friends in exchange for authorization to “submit false claims for services not actually rendered.â€
Victoria recruited women from strip clubs and through referrals to offer sexual services to dockworkers in her businesses, federal prosecutors said.
Late-night negotiations averted a strike by the nation’s railroad workers, which would have had huge effects on the U.S. and California economies.
Some of the false claims were filed using the names of dockworkers’ family members, including spouses and children.
Victoria submitted more than $2.1 million in false claims, and more than $550,000 was paid out, according to the U.S. attorney’s office for the Central District of California.
The plea agreements for seven of the dockworkers and Victoria and one of her workers were filed Wednesday, with the defendants expected to appear in court in the coming weeks.
Victoria, who agreed to plead guilty to one count each of conspiracy to commit healthcare fraud and aggravated identity theft, faces up to 12 years in federal prison after she enters her plea. Her employee agreed to plead guilty to one count of conspiracy.
Four of the dockworkers will plead guilty to one count of conspiracy to commit healthcare fraud, and three will plead guilty to one count of theft in connection with healthcare.
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Long Beach dockworker Cameron Rahm, who was also charged in connection with the scheme and accused of lying to federal investigators, pleaded not guilty.
Rahm, 39, of Pico Rivera, is accused of authorizing Victoria to submit false claims for sexual services. He denied doing so to FBI agents investigating the case, prosecutors said.
Rahm was charged in a federal grand jury indictment with one count of conspiracy to commit healthcare fraud, two counts of healthcare fraud and one count of making false statements to federal investigators.
If convicted, he faces up to 10 years in prison for the healthcare fraud charges and five years in prison for making false statements.
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