The owner of two compounding pharmacies, Matthew Hogan Peters, was sentenced to prison for evading payment of nearly 5.5 million dollars in personal income taxes and for submitting false reimbursement claims to CVS Caremark.
Peters devised a scheme to incentivize healthcare providers to write prescriptions for custom mixed medications that generated large reimbursements for his pharmacies. During an audit conducted by CVS, dozens of claims lacked records that proved customers received the medications. When questioned, Peters submitted proof of customer signatures that were eventually all tracked back to DocuSign files on his personal computer.
To further complicate his criminal liability, Peters generated nearly 14 million dollars in gross income between 2014 and 2017 but hid millions from the IRS. He spent 3.3 million dollars for property and construction in Belize, more than five million dollars for personal residences in Laguna Beach and San Carlos, California, and millions in cash transfers to straw entities and trust accounts in the names of others for his personal use. Between 2014 and 2017 Peters underreported his income by more than 5.4 million dollars.
Peters was sentenced to three years in prison and ordered to pay $3,441,263 in restitution to the IRS.