Bridgeport doctor faces felony charges for dermatology practice - WBOY.com: Clarksburg, Morgantown: News, Sports, Weather

Bridgeport doctor faces felony charges for dermatology practice

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A Bridgeport doctor is facing several felony charges after federal prosecutors allege he devised a scheme to defraud Medicare and Medicaid, made and subscribed false tax returns, falsified a bankruptcy document and made a false statement to a federal agent.

Dr. Allen G. Saoud, 58, served as a doctor of osteopathic medicine and owned the dermatology practice of AGS Inc. in Bridgeport, according to a news release from the U.S. Attorney's office.

A Dec. 4 indictment alleged Saoud submitted "false and unsupported medical billing claims" to Medicare and Medicaid between May 1998 and June 2004.

However, the U.S. and Saoud reached a settlement regarding these claims in August 2005 where Saoud did not admit liability but agreed to pay $310,800.58 to the U.S., the indictment states.

The agreement also listed a provision where Saoud agreed to be excluded from Medicare, Medicaid and other federal health programs for 10 years, the indictment states.

Federal prosecutors assert Saoud violated that agreement from May 2005 to October 2010. The indictment asserts Saoud devised a scheme to defraud Medicare and Medicaid.

The indictment also asserts he established a new dermatological practice, Central West Virginia Dermatology Associates Inc., and transferred ownership to another doctor.

"The purchase price for CWVD's ‘shares' was $1.6 million, but Saoud did not receive any payment for CWVD. Moreover, before August, 2005, CWVD was not an operational medical practice," the indictment says.

All of AGS' medical staff and patients were transferred to the new practice, the indictment says.

Federal prosecutors say Saoud "actively participated in the management and administration of CWVD," which they say is in violation of the agreement.

The indictment further asserts Saoud received benefits from the new practice including "pathology lab service reimbursements, rental income, and uncompensated usage of CWVD's staff, facility and billing system."

Saoud then, the indictment further alleges, "engaged in a sham sale of AGS" to a nurse practitioner. The indictment asserts this sale was invalid because "he induced the sale agreement under false pretenses, no sale price was paid and West Virginia state law prohibits a non-physician from owning a medical corporation."

The indictment says Saoud continued his involvement in AGS' management and administration after this sale and continued to practice medicine under AGS' name. He also identified himself as the practice's president, the indictment asserts.

The indictment further asserts Saoud fraudulently filed bankruptcy for AGS in May 2009 to "avoid or delay a civil lawsuit from Mountain State Blue Cross/Blue Shield regarding alleged medical overbilling by Saoud."

"To legitimize the bankruptcy filing, Saoud forged the signature of the purported owner of AGS on a document authorizing Saoud to file bankruptcy for AGS," the indictment alleges.

The indictment further asserts he made false statements in sworn testimony in the bankruptcy proceedings about his involvement with AGS and CWVD.

From September 2005-October 2010, the indictment continues to allege, AGS and CWVD received $2 million in Medicare and Medicaid reimbursements.

"During the same time period, Saoud fraudulently obtained at least $850,000 from AGS and CWVD in violation of the Exclusion Agreement."

The indictment further alleges he made a false individual income tax return for 2006 and that he falsely wrote in a letter to a IRS revenue agent that he was not an AGS officer and had "no relationship with Central West Virginia Dermatology since it was sold … in the third quarter of 2005."