New York man pleads guilty to $1.9 million formula fraud scheme

A New York man pleaded guilty Thursday to a $1.9 million scheme to sell fraudulently obtained infant formula, according to the Department of Justice (DOJ).

Prosecutors allege that Staten Island resident Vladislav Kotlyar, 43, submitted and caused the submission of false prescriptions and medical records for specialty infant formula that were paid for by health insurers. Court documents allege that Kotlyar obtained prescriptions and medical records for infants who were prescribed specialized infant formula and falsified those records to obtain additional infant formula of the same type.

“After receiving the specialty formula, Kotlyar fabricated issues with the shipments, including falsely claiming they were damaged or incorrect formula to acquire additional formula at no additional cost. Kotlyar then sold the fraudulently obtained formula,” according to the DOJ.

“As part of the scheme, Kotlyar and his co-conspirators submitted more than $1.9 million in fraudulent claims against health insurers, including during a national formula shortage,” the agency continued.

Kotlyar pleaded guilty to mail fraud and agreed to forfeit approximately $1 million and repay over $738,000 in restitution. The DOJ did not name any of Kotlyar’s co-conspirators.

Kotlyar faces a maximum sentence of 20 years in prison. District Attorney Patrick Campbell of the Criminal Division’s Fraud Section is prosecuting the case.


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