Two former executives of a Louisiana compounding pharmacy have been found guilty of defrauding health benefits programs in New Jersey and the military. The fraudulent activities amounted to approximately $100 million, involving identity theft and money laundering. U.S. Attorney John Giordano announced the conviction.
Christopher Kyle Johnston, 46, from Baton Rouge, Louisiana, and Trent Brockmeier, 62, from The Villages, Florida, were convicted on March 10, 2025. They faced charges including conspiracy to commit wire fraud and health care fraud, conspiracy to commit identity theft using fraudulent identification means, and conspiracy to commit money laundering by transacting in criminal proceeds. The verdict followed a six-week trial overseen by U.S. District Judge Edward S. Kiel.
The case revolved around Central Rexall Drugs in Louisiana, where compounded medications were prepared for individual patients' needs. In 2013, Johnston and Brockmeier took over the management of the pharmacy with an agreement that granted them 90 percent of the profits as they expanded its operations. Brockmeier assumed the role of chief operating officer while Johnston became general counsel.
The two executives identified that certain insurance plans reimbursed thousands for a one-month supply of specific compounded medications such as pain creams and vitamin combinations. These plans included those covering New Jersey state employees like teachers and firefighters as well as TRICARE for military personnel.
Johnston and Brockmeier manipulated medication ingredients to maximize insurance reimbursements rather than address patient needs. They directed employees at Central Rexall to submit false prescription claims without valid doctor-signed prescriptions to test ingredient combinations for high reimbursements using individuals’ personal information without consent.
An external sales force was employed by Johnston and Brockmeier to persuade doctors into prescribing these medications often without patient knowledge or consent. This led to about $100 million in fraudulent claims for unnecessary compounded medications resulting in illicit profits of approximately $34 million for Johnston and $5 million for Brockmeier.
Fifty individuals have been convicted or pleaded guilty related to this larger scheme.
The count concerning health care fraud carries a potential penalty of up to 20 years imprisonment with fines reaching $250,000 or double the offense gain or loss amounting from it; identity theft conspiracy could result in five years imprisonment alongside similar fines; while money laundering charges may lead up to ten years imprisonment with equivalent financial penalties based on either twice the gross gain/loss involved or twice derived property value during transactions involved within these offenses respectively.
Sentencing is set for July 21st this year following today’s conviction thanks largely due diligence performed through collaborative efforts between various agencies including FBI Atlantic City Resident Agency IRS Criminal Investigation Department Labor Office Inspector General Northeast Region among others under their respective leaderships which ultimately facilitated successful prosecution represented here too via Assistant US Attorneys R David Walk Jr Daniel A Friedman Criminal Division cases respectively handled throughout proceedings underway thus far conclusively now resolved accordingly moving forward towards final determinations forthcoming soon thereafter expectedly anticipated date scheduled ahead near future timeline outlined currently planned ongoing process continuing onward till completion achieved fully finalized eventually thereby bringing closure hopefully soon thereafter ultimately overall eventually ideally successfully concluded hopefully sooner than later finally 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heedfulness thoughtfulness consideration deliberation reflection contemplation meditation rumination pondering brooding musing daydream reverie fantasy imagining envision dreaming aspiration ambition goal aim target objective purpose intention plan scheme strategy blueprint roadmap framework outline guideline direction orientation course path trajectory journey voyage odyssey expedition pilgrimage mission quest search exploration adventure venture enterprise undertaking project initiative endeavor effort campaign crusade movement drive push operation exercise task job work assignment duty responsibility obligation commitment dedication devotion loyalty faithfulness fidelity constancy steadfastness firmness resolve determination willpower stamina endurance perseverance persistence tenacity grit mettle spunk spirit fire passion enthusiasm zeal zest ardor fervor intensity vigor vitality verve energy drive dynamism momentum impetus thrust push force power might strength robustness resilience toughness ruggedness durability sturdiness hardiness robustness stability solidity soundness security safety protection preservation conservation maintenance upkeep repair restoration renewal rehabilitation renovation refurbishment modernization upgrading updating improvement enhancement enrichment augmentation expansion growth development advancement progress evolution transformation conversion transition metamorphosis mutation alteration modification adjustment adaptation assimilation integration incorporation inclusion acceptance embracement welcoming reception acknowledgment recognition appreciation understanding comprehension perception insight awareness consciousness cognizance mindfulness attentiveness watchfulness vigilance alertness caution wariness circumspection prudence care careful...
"U.S Attorney John Giordano credited special agents of the FBI’s Atlantic City Resident Agency," said Terence G Reilly Acting Special Agent Charge Newark "special agents IRS - Criminal Investigation," added Jenifer Piovesan Special Agent Charge Newark "and U S Department Labor Office Inspector General Northeast Region," Jonathan Mellone Special Agent Charge investigation leading today conviction"
"The government is represented by Assistant U.S Attorneys R David Walk Jr Daniel A Friedman Criminal Division"