Sean E. O’Keefe was a well-known applicant attorney in San Diego, Public records list him as the lawyer on about 9,000 injured workers’ cases. And he admitted to a grand jury that he paid cash for the bulk of the clients who walked through his door.
In recently released court records summarized in an article by the Center for Investigative Reporting, O’Keefe testified that he paid a firm to send him two-thirds of his clients. He also promised the recruiter, Carlos Arguello, that he would make sure those workers ran up bills at certain medical providers who offered MRIs, sleep studies, psychology, medications and toxicology screenings.
“I was greedy and stupid,” O’Keefe told a San Diego grand jury Dec. 1. “Clients or patients were essentially treated as commodities and billing opportunities.”
O’Keefe’s revelations came in testimony recently unsealed in one of more than a dozen criminal cases against more than 100 people who made their living off the medical care rendered to California’s injured workers.
His testimony highlights Arguello’s recruitment firm, Centro Legal, as a big player. It was so efficient, O’Keefe said, that the kickback cash flow was “almost universal” in the treatment of Latino injured workers in Southern California.
The testimony sheds light on the way injured workers are used for profit, regardless of their medical needs. It also reveals the ongoing efforts of prosecutors to clean up a system that California lawmakers and officials are charged with governing.
O’Keefe, now barred from practicing law, testified that he earned about $1.1 million a year representing injured workers, mostly by collecting a 15 to 18 percent fee from the settlement of their injury cases. He pleaded guilty in August 2014 to federal charges of health care fraud and agreed to cooperate with prosecutors in hopes for a more lenient sentence.
In the recently unsealed San Diego County Superior Court testimony, he broke down how the kickback scheme worked. O’Keefe said he paid Arguello for each client. Arguello has pleaded not guilty to federal charges related to his alleged patient recruiting and referral scheme.
An FBI agent who testified in the case said Arguello’s firm engaged in “guerrilla marketing,” passing out cards at the border crossing to Tijuana, Mexico; putting them on parked cars; and displaying them in restaurants. The cards advised workers that they could earn up to $4,000 per month if they were injured at work.
O’Keefe said Arguello told him which chiropractor or doctor to which the patient would be referred. The doctor, in turn, would cut his or her own deals over the patient’s referrals for MRIs, sleep studies, nerve tests and medicated pain creams. “And so whether I was paying for a referral or receiving a bribe, I could also be exchanging those clients for other clients, so to speak, more clients,” O’Keefe testified.
O’Keefe noted that he didn’t send all of his clients into Arguello’s network of preferred doctors and chiropractors. He said he would engage in some “smoke and mirrors” and “spread the clients around a little bit” so workers’ compensation insurers wouldn’t cry foul over his practices. “Otherwise,” he testified, “you couldn’t do what I’ve been doing for decades.”