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Dean Smith

Unlicensed NJ Chiropractor Orchestrates $4 Million Medical Fraud Scheme


According to the New Jersey Office of the Attorney General, 62-year-old Philip Potacco of Kinnelon, NJ, former chiropractor who had his licensed revoked in 2002, has been charged with organizing a massive $4 million medical fraud scheme against multiple insurers spanning from 2010 to 2015.

Potacco ran the scheme from his business, South Orange Medical Facility Consulting Group LLC, in which he hired a legitimate, licensed chiropractor (John Langeraap, 37, of Sparta, NJ) as a straw owner; the perfect cover for him to run the business and scam behind the scenes.

“Runners” were utilized to funnel accident patients to his facility (some accidents were even staged). Fraudulent insurance claims were then submitted by Potacco under Langeraap’s billing information, some for services that were never rendered.

But how did he obtain and utilize approximately $3,991,812? Prosecutors explained that, “Potacco funneled approximately $3,991,812 in claim money into South Orange Medical Facility Consulting Group LLC’s account. He then allegedly laundered the lion’s share of that money through a shell company called Medical Consulting Group LLC. Once he transferred the money into the Medical Consulting Group LLC account, Potacco used the account for personal use, withdrew thousands of dollars in cash, and wrote checks to deposit in his own name and his wife’s name.”

On top of that, Potacco also acted as a runner and collected funds for referrals from a South Orange personal injury attorney (Mark Gertner, 66, of Montclair) who filed insurance claims on behalf of the accident “victims.” Potacco then provided the attorney with fraudulent medical reports in support of the claims.

Acting Attorney General Robert Lougy stated, “This was an elaborate web of lies and deceit allegedly spun by one disgraced medical practitioner who cloaked himself in the identity of a licensed practitioner to steal millions of dollars from insurance companies. It is especially disturbing that this bad apple was able to entice professionals in good standing to join his criminal endeavors.”

Another substantial win for the fight against insurance fraud with this list of those indicted and the hefty charges against them:

Philip Potacco, 62, Kinnelon, NJ: conspiracy (1st degree), three counts of money laundering (1st degree), theft by deception (2nd degree), health care claims fraud (2nd degree), insurance fraud (2nd degree), criminal running (3rd degree), falsifying medical records (4th degree), official misconduct (2nd degree), and unlicensed practice of chiropractic (3rd degree).

South Orange Trauma & Rehab, LLC: conspiracy (1st degree), three counts of money laundering (1st degree), theft by deception (2nd degree), health care claims fraud (2nd degree), insurance fraud (2nd degree), and criminal running (3rd degree).

Medical Consulting Group, LLC: conspiracy (1st degree), three counts of money laundering (1st degree), theft by deception (2nd degree), health care claims fraud (2nd degree), insurance fraud (2nd degree), criminal running (3rd degree), and falsifying medical records (4th degree).

John Langeraap, 37, Sparta, NJ: pleaded guilty to second degree conspiracy to commit insurance fraud.

Jude M DiManche, 41, East Orange, NJ: two counts of criminal running (3rd degree).

Andre J. Richemond, 41, East Orange, NJ: one count of criminal running (3rd degree).

Mark Gertner, 66, Montclair, NJ: pleaded guilty to third-degree criminal running.

Anulet Josaphat, 62, Union, NJ: pleaded guilty to third-degree criminal running.

Wilguere Rezan, 44, Irvington, NJ: pleaded guilty to third-degree criminal running.

According to the Attorney General’s Office, “first degree charges carry a sentence of 10 to 20 years in state prison and a fine of up to $500,000; second-degree charges carry a sentence of five to 10 years in state prison and a fine of up to $150,000; third-degree charges carry a sentence of three to five years in state prison and a fine of up to $15,000; fourth-degree charges carry a sentence of up to 18 months in state prison and a fine of up to $10,000.”

All are presumed innocent until proven guilty.

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