Four chiropractors and a capper were charged this week with insurance fraud in a massive multi-million dollar workers’ compensation insurance referral scheme that exploited persons in predominantly Spanish-speaking communities.

Last year, 10 attorneys and six cappers were charged as part of the same investigation. This is the second phase of filing resulting from a 4-year insurance fraud investigation by the Orange County District Attorney’s Office Bureau of Investigation, Insurance Fraud Unit.

Three defendants charged in Phase I of this investigation have pleaded guilty to participating in the unlawful referral scheme, with one pleading to multiple counts of insurance fraud. In 2014, the OCDA received a tip from a major insurance carrier and initiated an investigation in conjunction with CDI, which ultimately involved more than 20 insurance carriers and self-insured entities conducting business in California.

In 2005, Carlos Arguello III formed Centro Legal Internacional, an “advertising” company, and secured unlawful referral contracts with 20 to 40 workers’ compensation insurance and personal injury attorneys. Arguello required all participating attorneys to sign annual contracts entitled “joint advertising agreement.” Based on the contracts, the attorneys paid Arguello a specified monthly fee for procuring and delivering a minimum number of retained clients per month. Arguello used several names for his referral scheme, including Centro Legal Int’l, Justicia Legal Int’l, and Centro de Abogados Int’l.

He had websites created to advertise these legal services, including iwantmylawyernow.com, instantlawyeraccess.com, centrodeabogadosinternacional.com, uniondeabogadoslatinos.com, and unitedinjuryattorneys.com. Each website and advertisement offered a “free consultation” via an online consultation form or a toll-free number. The toll-free numbers for Centro Legal Int’l, Justicia Legal Int’l, and Centro de Abogados were all directed to a call center in Tijuana, Mexico.

Arguello also owned or was affiliated with other companies that he had the attorneys refer business to, including C & E Technology, Professional Document Management, and Providence Scheduling.

Edgar Gonzalez, another charged defendant in Phase I, is accused of paying attorneys for referral of business to his copy service company, called USA Photocopy, and billing the work to workers’ compensation insurance carriers.

The new Phase II involves Arguello’s call center operators and sign-up agents who were required to stress to the callers the importance of medical treatment to their workers’ compensation or personal injury case, encouraging them to show up to all appointments.

Once the caller agreed to become represented by an attorney from Arguello’s scheme, the “client” was then sold to Providence Scheduling, a service Fermin Iglesias is accused of owning and operating. Iglesias is accused of having arrangements with several chiropractors, including defendants Afsoun Naderi, Bahar Danesh Gharib, Bryan Aun, and John Larson, who are accused of paying Providence Scheduling for patients under the guise of a “Promotion and Scheduling Services Agreement.”

Iglesias is accused of directing these chiropractors to also prescribe durable medical equipment (DME) to their patients through his several DME companies, including Meridian Rehab, Bright Rehab Solutions, Prime Medical Resources, and Prime Orthopedics, all of which he billed to workers’ compensation insurance carriers.

Iglesias is further accused of requiring the chiropractors to refer all diagnostic imaging tests, such as MRI’s, through a scheduling company owned by Iglesias and Arguello called Medex Solutions.

The diagnostic facility owners are accused of paying Iglesias and Medex Solutions kickbacks disguised as “scheduling service” fees for each completed scan. All diagnostic services were billed to workers’ compensation insurance carriers.