A federal grand jury has issued a 15-count indictment charging the former CEO of eHealth Technologies, a Rochester, N.Y.-based health IT company, with wire fraud, money laundering and filing a false tax return, according to the Department of Justice.
Five things to know:
1. According to the indictment, Michael Margiotta caused eHealth to pay roughly $455,000 in fraudulent invoices between May 2011 and January 2014. Most of the funds were transferred into his personal brokerage account, according to the Justice Department.
2. Mr. Margiotta allegedly caused a company eHealth contracted with for employment recruiting services to submit fraudulent invoices to eHealth. He then directed subordinate employees to pay the false invoices, according to the Justice Department.
3. According to the indictment, Mr. Margiotta also caused an individual to submit fraudulent invoices to eHealth for services actually provided to an unrelated organization known as Action Against Child Maltreatment and then directed eHealth to pay the invoices. AACM is a charity controlled by Mr. Margiotta, according to the Justice Department.
4. On Feb. 16, eHealth, a provider of medical record retrieval and organizations services and image-enabled health information exchanges, issued the following statement regarding the indictment:
"Mr. Margiotta's employment ceased with eHealth Technologies in 2014 and he has not been involved in its operations since that time. The investigation focused on Mr. Margiotta's actions, and not on eHealth Technologies nor any of our current employees, directors, officers, or business partners."
5. The charges against Mr. Margiotta carry a maximum penalty of 20 years in prison.
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