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Conspiracy to Commit Theft or Embezzlement in Connection with Healthcare (18 U.S.C. 669; 18 U.S.C. 371)
Last Updated on: 18th April 2025, 11:00 pm
Conspiracy To Commit Theft or Embezzlement in Connection with Healthcare
(18 U.S.C. 669 and 18 U.S.C. 371)
HEADLINE: Federal agents are charging New York technicians, pharmacy reps, and union officers with health‑plan rip‑offs every single month. You think the feds will look the other way because the dollar amount feels “small”? Wrong. One overt act, one penny misapplied, and you’re staring at felony exposure. Read everything below, then decide if gambling with your future still makes sense.
Why This Statute Hits Home in New York
New York City is a health‑care hub: 14 major hospital systems, dozens of union welfare funds, and endless Medicaid dollars. Prosecutors at the Southern District of New York (SDNY) know money flows fast through benefit programs like the IBEW Health & Welfare Fund and city employee plans. When just $101 goes missing, 18 U.S.C. 669 lets them charge a ten‑year felony. Pair that with the general conspiracy law, 18 U.S.C. 371, and they don’t even have to prove the theft happened—only that two people planned it and someone took one step toward the goal.
LOCAL REALITY CHECK: The SDNY recently piggy‑backed on a New Jersey sting that exposed a $5.3 million kickback ring tied to downstate clinics (DOJ press release 12‑12‑2024). Several “referral runners” lived in Queens. They never touched clinic books, yet the conspiracy statute still wrapped them in the indictment. If you move paperwork, share spreadsheets, or even text ideas about skimming, congratulations—you’re inside the blast radius.
Statute Snapshot
| Element | 18 U.S.C. 669 – Theft/Embezzlement | 18 U.S.C. 371 – General Conspiracy |
|---|---|---|
| Protected Target | “Health care benefit program” money, assets, premiums, property | Any federal offense or scheme to defraud the U.S. |
| Mental State | Knowingly & willfully | Agreement + intent to commit offense |
| Key Act | Embezzle, steal, convert, or intentionally misapply | Any overt act by one conspirator |
| Penalty Range | Up to 10 years (≤ $100 = ≤ 1 year) | Up to 5 years (fine and/or prison) |
| Common Pair‑Up | Often charged with 18 U.S.C. 1347 (health‑care fraud) and 1028A (aggravated identity theft) | Used to enhance all the above—one indictment, multiple counts |
The Prosecutor’s Playbook
Step 1 – Follow the Money. Agents subpoena billing software, union‑fund ledgers, and bank statements. Any unexplained vendor credit raises a red flag. Consequence: Funds freeze, your payroll stutters, panic sets in.
Step 2 – Flip the Weakest Link. Junior billers face 10 years on the 669 count. The government dangles a 371 plea (max 5 years) if they testify. Consequence: Your former intern is now the star witness narrating every group chat you ever typed.
Step 3 – Stack Counts to Crush Leverage. They add kickback (42 U.S.C. 1320a‑7b), mail fraud (18 U.S.C. 1341), or money laundering (18 U.S.C. 1956). Consequence: Plea talks start at decades, not months—unless you know how to fight.
Defenses Spodek Law Group Deploys 24/7
Early‑Strike Motion Practice. We attack the “health care benefit program” definition. Medicare Advantage plans, self‑insured employer funds, and certain union trusts don’t all qualify the same way. If the plan is outside federal jurisdiction, 669 collapses. Outcome: Case dismissed or kicked to state court with softer penalties.
Value‑Threshold Warfare. 669 drops from a ten‑year felony to a one‑year misdemeanor when the property is ≤ $100. Prosecutors often aggregate multiple transactions. We isolate each alleged loss to push totals below the line. Outcome: Felony becomes misdemeanor; jail time becomes probation.
No Overt Act? No Conspiracy. Section 371 demands at least one concrete act. A brainstorm on Zoom is not enough. We comb discovery for gaps—did anyone actually move funds, or merely plot? Outcome: Conspiracy count dismissed; leverage in plea talks flips.
Intent – The Psychological Kill Switch. Blue‑collar employees frequently rely on supervisors’ instructions. If you believed the transfer was legitimate—say, a routine “inter‑fund loan”—intent evaporates. We bring in industry experts to testify on standard practice. Outcome: Reasonable‑doubt wedge driven straight through the jury box.
Parallel‑Proceeding Shield. Agencies like HHS‑OIG push civil money penalties while DOJ runs the criminal side. We negotiate a global civil settlement early, then argue “punishment served” when criminal sentencing arrives. Outcome: Fines, yes—prison, no.
Common NYC Scenarios
Scenario 1 – Bogus Union Vision Claims. Manhattan optical shop submits $75 frames as $750 designer eyewear. Billing clerk and shop owner split the difference. Clerk thinks it’s just “over‑billing.” Prosecutors call it 669 theft + 371 conspiracy. Lesson: Kickbacks and up‑coding land in the same indictment.
Scenario 2 – Hospital Gift‑Card Skimming. A Bronx hospital orders patient‑satisfaction gift cards. Purchasing manager diverts $15 k worth to family. Because hospital participates in Medicare, cards are “assets of a health care benefit program.” Consequence: Ten‑year felony for what looked like petty larceny.
Scenario 3 – Pharmacy Friendly Referrals. Staten Island nurse texts a pharmacist: “Send $50 Zelle for every new diabetic we push to you.” That text is the overt act. Even if no patient switches pharmacies, 371 attaches. Stop bragging in group chats.
Sentencing Reality Check
The U.S. Sentencing Guidelines start at Base Level 6 (0‑6 months) for property ≤ $6,500. Every dollar past that triggers upward adjustments—plus a two‑level bump for abuse of a “position of trust.” In New York, judges lean on restitution and guideline compliance. Translation: A $150 k union‑fund loss with a leadership role can push prison to 24‑30 months. Add laundering or identity theft? You’re flirting with five years inside.
Compliance Isn’t a Luxury—It’s Armor
HHS‑OIG’s nursing‑home guidance (1999 Draft) still sets the yardstick. Documented internal audits, rapid gift‑log reviews, and vendor‑contract approvals can slash your exposure. Statement: Every policy you fail to write becomes prosecution Exhibit A. Consequences: Juries assume silence equals intent.
Stop the Excuses—Start the Defense
Look, telling yourself “I’m just the warehouse guy” won’t cut it. If your name sits on inventory transfers, you’re already in the conspiracy loop. Waiting for that scary grand‑jury letter wastes leverage. Call our office before agents knock. We run a 24/7 risk‑free consultation line at 888‑997‑5177. One call can mean the difference between probation and prison.
FAQ in Plain English
Isn’t 18 U.S.C. 669 just “health‑care fraud” with a new label?
No. Fraud (18 U.S.C. 1347) needs deception in billing. 669 hits straight theft—gift cards, equipment, union dues—anything owned by a health plan.
Can they charge me in New York if the plan is headquartered in New Jersey?
Yes. Venue exists wherever any part of the conspiracy took place. A single e‑mail sent from Brooklyn suffices.
Does a guilty plea under 371 bar future civil suits?
Usually not. The plan’s trustees can still sue for restitution. Plus, OIG may slam you with an exclusion order—meaning you can’t work for any Medicare‑funded employer.
NEXT STEP: OWN THE OUTCOME
If you’ve skimmed to this point hoping the problem “blows over,” it won’t. SDNY, EDNY, and the FBI Health Care Fraud Task Force built entire squads around 669 conspiracies. Your only leverage is proactive counsel.
Spodek Law Group—coast‑to‑coast criminal defense, media‑tested, outcome‑obsessed—stands ready. We limit our caseload so every client gets rock‑star focus. No excuses, no sugar‑coating, just a strategic plan that attacks root causes and shuts down federal momentum.
Judges respect preparation. Prosecutors fear unpredictability. We deliver both. Call, text, or use our encrypted portal now. Freedom rarely waits.
DISCLAIMER: Past success does not guarantee future results. This article is attorney advertising and provides general information only. It is not legal advice and does not create an attorney‑client relationship. Every case turns on specific facts. Consult qualified counsel before acting on any information here. Communications through this page may not be secure.