TESTIMONY OF DARA CORRIGAN 
ACTING PRINCIPAL DEPUTY INSPECTOR GENERAL 
 
Good morning, Mr. Chairman and Members of the Committee.   
 
Many Medicare beneficiaries with impaired mobility have a legitimate need for 
wheelchairs and benefit greatly from their use.  However, we have found significant and 
troubling abuses of the Medicare wheelchair benefit that deplete the Medicare Trust Fund 
of scarce dollars and harm beneficiaries.  Today, I will describe some particularly 
worrisome fraud schemes that our investigators recently have uncovered.  I also am 
issuing two inspection reports on wheelchair problems in the Medicare program.  In one 
study, we found that most power wheelchair claims for Medicare beneficiaries did not 
meet the programs coverage criteria.  The second study addresses Medicares excessive 
reimbursement amounts for power wheelchairs.   
 
POWER WHEELCHAIRS IN THE MEDICARE PROGRAM 
  
Our office has devoted considerable resources to conducting investigations, evaluations, 
and audits in the area of medical equipment and supplies.  This area of the Medicare 
program has been particularity susceptible to fraud, waste, and abuse over the years.  We 
have identified problems related to a wide range of items and equipment including 
oxygen, transcutaneous electrical nerve stimulators, seat lift chairs, orthotic body jackets, 
wound care supplies, incontinence supplies, and lymphadema pumps.  We have found 
that many medical equipment and supplies: (1) have been susceptible to fraud and abuse; 
(2) fail to meet coverage criteria and prescription requirements for particular items and 
supplies; (3) and have been reimbursed at excessive amounts.  When we do shut down 
the fraud and abuse for one item or supply, it is only a matter of time before we see 
similar issues associated with other medical equipment and supplies. 
 
The three vulnerabilities mentioned above are now present with respect to power 
wheelchairs.  To preserve the integrity of the power wheelchair benefit and prevent 
excessive payments, Medicare must ensure that suppliers are legitimate, beneficiaries are 
eligible to receive the equipment, physicians are prescribing equipment appropriately, 
and equipment is reasonably priced.   
 
Over the past several years, Medicare has seen notably dramatic growth in expenditures 
for power wheelchairs, particularly for the power wheelchair with Healthcare Common 
Procedure Coding System (HCPCS) code K0011, which is for a standard-weight power 
wheelchair with programmable control parameters.  Spending for power wheelchairs 
increased approximately 350 percent from 1999 to 2003, while total Medicare 
expenditures have increased only 23 percent for that same time period.  Between 2001 
and 2002 alone, Medicare payments for procedure code K0011 rose from $513 million to 
$829 million, a 62 percent increase.  Payments for K0011 power wheelchairs continue to 
rise and have already reached $1.2 billion for 2003, which is 12 percent of total Medicare 
Part B expenditures for medical equipment and supplies.  Beneficiaries are responsible 
for 20 percent of the allowed payment amount in the form of coinsurance.    
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 1    
Medicare also has seen an increase in utilization of the power wheelchair benefit.  The 
number of Medicare beneficiaries with at least one claim for a motorized wheelchair rose 
from approximately 55,000 in 1999 to an estimated 274,000 in 2003, an increase of 
almost 400 percent.  During the same time period, the overall Medicare population rose 
only 1 percent per year.  We recognize that some of this rise may be attributable to such 
things as technological improvements or successful beneficiary outreach rather than 
solely fraud and abuse issues.  However, as I will discuss below, we believe that the 
wheelchair benefit is a significant vulnerability to the Medicare program. 
 
There are three main controls in place to help limit abuse of the wheelchair benefit.  First, 
in order to qualify for power wheelchairs, beneficiaries must meet Medicares coverage 
criteria.  Beneficiaries must be bed or chair confined, unable to operate a wheelchair 
manually, and capable of safely operating the controls of the power wheelchair.  A 
Medicare beneficiary who qualifies for a power wheelchair usually is totally non-
ambulatory and has severe weakness of the upper extremities due to a neurologic or 
muscular disease or condition.   
 
Second, to help ensure the appropriateness of the equipment prescribed, suppliers who 
submit claims for power wheelchairs must include a Certificate of Medical Necessity 
(CMN).  A physician is required to sign, date, and complete the medical justification 
portion of the CMN.  This is perhaps the most fundamental safeguard that the program 
relies on to ensure that Medicare pays for wheelchairs that are medically necessary and 
reasonable.  Suppliers must maintain copies of signed CMNs in their records along with 
documentation showing that items were delivered to beneficiaries.  Typically, CMNs are 
submitted electronically to the Durable Medical Equipment Regional Carriers (DMERCs) 
who are responsible for processing the claims.  Original copies of CMNs are not 
reviewed unless DMERCs specifically request this information from the supplier on a 
pre- or post-payment basis.  Similarly, suppliers are not required to submit proof of 
delivery with the initial claim for payment, and DMERCs only collect delivery 
documentation as part of a pre- or post-payment review.    
 
Finally, over the past several years, the National Supplier Clearinghouse has strengthened 
the supplier enrollment process in an effort to limit ease of entry by fraudulent suppliers.  
In order to obtain a Medicare billing number, suppliers must complete an application, 
submit to an onsite inspection of the business location, and meet 21 standards that help 
ensure that the suppliers are operating legitimate businesses.  Although there is no 
Federal licensure requirement, States can require licensure, and some States have adopted 
such a requirement for home medical equipment suppliers.   
 
PAYMENT TO FRAUDULENT SUPPLIERS  
 
Despite CMSs efforts, we have found that fraudulent suppliers continue to bill the 
Medicare program.  Our investigative activity continues to disproportionately (based on 
program expenditures) be focused on medical equipment and supplies.  From 2002 through 
2004, we excluded from the Medicare and Medicaid programs 277 providers associated with 
medical equipment supply companies.  However, there is evidence that unscrupulous 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 2   wheelchair suppliers have gained a foothold in the Medicare program, and greater effort 
must be made to prevent these types of suppliers from gaining admission to the Medicare 
program.    
 
The fraud we have uncovered generally falls into the following categories: (1) filing 
claims for equipment that was never delivered; (2) billing for high cost equipment when 
lesser cost equipment was actually provided (upcoding); (3) billing for the component 
parts of a piece of equipment instead of the entire unit (unbundling); (4) delivering 
medical equipment to beneficiaries who do not need it; and (5) paying kickbacks to 
physicians and other sources in return for the referral of beneficiaries, access to 
beneficiaries and/or signing CMNs.  We have been working on some of these 
investigations since as early as 1996.   
 
I have attached summaries of several investigations of power wheelchair suppliers that 
we have conducted.  I would like to highlight two cases that involved schemes to 
fraudulently bill Medicare and Medicaid for medical equipment, including power 
wheelchairs.  Although the first case is not nearly the largest wheelchair scheme in the 
country, nor even in South Florida where it occurred, it provides some insight into the 
elaborate schemes that individuals will concoct to defraud Federal health care programs.  
 
The Governments investigation revealed that co-owners of two medical equipment 
supply companies used recruiters to enlist beneficiaries to participate in a scheme to 
defraud Medicare.  The recruiters told beneficiaries to bring their Medicare information 
to a central location, such as a community center in a housing development, where they 
were instructed to sign phony documents.  These documents included post-dated delivery 
tickets.  The CMNs in support of the false claims were procured from physicians who 
received kickbacks or were forged. 
 
The beneficiaries would take turns posing on one wheelchair, used as a prop, while their 
pictures were taken with a Polaroid camera, purportedly to document that a wheelchair 
had been delivered to them.  On one occasion, the recruiters had planned staged 
deliveries in a second-story apartment with no elevator access.  They could not lift the 
heavy power wheelchair up the buildings stairs.  To overcome this problem, the 
beneficiaries were walked down the stairs so that the phony deliveries could be staged in 
the buildings parking lot.  Remember, the beneficiaries were supposedly non-
ambulatory.  The beneficiaries never expected actually to receive a wheelchair.  In 
exchange for their participation, beneficiaries were paid $200 to $800 cash or given 
nutritional products.   
 
Over a 9-month period, the co-owners billed Medicare for over $5 million in wheelchairs 
that were never delivered, and received $2.3 million in stolen payments.  These co-
owners were sentenced to 87 months and 54 months in prison, respectively, for their roles 
in submitting fraudulent power wheelchair claims to Medicare.     
 
The second case illustrates the significant dollar amounts at stake in these schemes.  The 
owner of a group of companies and his co-conspirators billed for medical equipment, 
including power wheelchairs, that was either not provided at all or upcoded.  For 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 3   example, beneficiaries were provided temporarily with a K0011 wheelchair.  The 
program was billed for the K0011, but the K0011 ultimately was swapped for a less 
expensive scooter.  In other cases, Medicare was billed for wheelchair accessories that 
never were provided.  The conspirators involved in this scheme sent proceeds to an 
overseas bank account.  They netted over $25 million.  The owner was sentenced to 
seven years in prison and ordered to pay $14.4 million in restitution, jointly and severally 
with his co-conspirators.  In addition, the court ordered a $14.8 million forfeiture against 
the owner.   
 
An independent sales representative from that same company targeted beneficiaries in 
low income housing areas to receive medical equipment, including power wheelchairs.  
He forged paperwork, including CMNs, and submitted it to the owner of the companies.  
This same sales representative was also involved in a separate scheme with a different 
DME company owner.  The two submitted claims for power wheelchairs, but switched 
the equipment out for less expensive scooters, falsified CMNs, including forging 
physician signatures, and submitted claims for medical equipment that was never 
delivered. This sales representative was sentenced to 18 months in prison and ordered to 
pay $2.2 million in restitution for his role in the conspiracy to defraud the Medicare and 
Medicaid programs.   
 
MEDICARE COVERAGE FOR POWER WHEELCHAIRS 
 
Not only have we uncovered fraud and abuse related to the wheelchair benefit through 
our investigations, but we also have found that many beneficiaries do not meet current 
coverage criteria for K0011 power wheelchairs.  One of the reports that we are releasing 
today addresses whether claims for K0011 power wheelchairs met Medicares coverage 
and documentation requirements.   
 
For our review, we selected a simple random sample of 300 claims for procedure code 
K0011 from the year 2001.  We then collected CMNs and delivery documentation from 
suppliers and medical records from ordering physicians.  Using Medicare coverage 
criteria, an independent medical review contractor conducted a coverage review of 
medical records received from physicians or suppliers.  We also contacted the 
beneficiaries who received our sampled power wheelchairs.    
 
We found that 31 percent of reviewed claims did not meet Medicares coverage criteria 
for any type of wheelchair.  An additional 45 percent of reviewed claims did not meet 
Medicares coverage criteria for the K0011 power wheelchair, but may have met criteria 
for another, less expensive mobility device.  Ultimately, only 13 percent of reviewed 
claims actually met the coverage criteria for K0011 power wheelchairs.  For another 11 
percent, the reviewer could not determine whether the claims met the coverage criteria 
for the K0011 power wheelchair due to insufficient documentation.  Based on our review, 
we estimate that Medicare and its beneficiaries paid $178 million in 2001 for K0011 
power wheelchairs that did not meet Medicares coverage criteria. 
 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 4   Our review also identified other problems with Medicare claims for K0011 power 
wheelchairs.  For over half of the claims reviewed, CMNs and/or delivery documentation 
were missing, incomplete or dated after the date of service.  In addition, some 
beneficiaries reported either not using their power wheelchairs or using them outside the 
home only.   
 
There may be a number of reasons why Medicare is paying for claims that do not meet 
coverage and documentation requirements.  Problems might arise because coverage 
criteria for different types of mobility devices may not be explicit enough, and physicians 
may not be familiar with Medicares coverage criteria when ordering mobility devices for 
their patients.  Ordering providers play a key role in determining the need for and 
utilization of equipment billed to Medicare.  This is recognized in the Medicare 
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), which states 
that payment may not be made for power wheelchairs unless a physician, physicians 
assistant, nurse practitioner, or clinical nurse specialist has conducted a face-to-face 
examination of the patient and written a prescription for the item.  CMS relies on the 
clinical judgment of these health care professionals to ensure that Medicare only pays for 
items that are most appropriate for beneficiaries.  However, the only document that 
provider is required to review and complete when ordering a wheelchair is the CMN.  
Coverage guidelines are not listed on the CMN for power wheelchairs, and medical 
necessity questions on CMNs are not completely consistent with coverage policy.  A lack 
of provider education about Medicares coverage criteria for wheelchairs could adversely 
affect physicians ability to make informed decisions about the types of mobility devices 
that are best for their patients, which could ultimately lead to inappropriate Medicare 
payments.   
 
EXCESSIVE PRICING FOR POWER WHEELCHAIRS 
 
The second report that I am releasing today assesses Medicares reimbursement levels for 
K0011 power wheelchairs.  We have consistently found over the years that many items of 
medical equipment have been reimbursed excessively.  This has in large part resulted 
because Medicare fee schedules for medical equipment, enacted in 1987, are based on 
historical charges to Medicare or retail prices available in the marketplace.   
 
With the rapid growth in utilization and expenditures of the power wheelchair benefit, it 
is essential that the Medicare program pay for power wheelchairs at levels that are 
consistent with prices in the marketplace.  We found that Medicare and its beneficiaries 
pay more than consumers or suppliers for K0011 power wheelchairs.  A wide variety of 
power wheelchair models are reimbursed under the K0011 procedure code; however, 
Medicare does not collect information on the specific model of power wheelchair actually 
provided to beneficiaries.  As part of our review, we identified Medicare-covered K0011 
power wheelchairs from the Statistical Analysis Durable Medical Equipment Regional 
Carriers product classification list.  We also identified K0011 power wheelchair models 
that were provided to Medicare beneficiaries in 2001.  We then obtained prices for these 
wheelchairs from three sources:  the websites of power wheelchair suppliers, two national 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 5   wholesalers, and suppliers who negotiated directly with manufacturers and distributors of 
K0011 power wheelchairs.   
 
We found that the median purchase prices for both consumers and suppliers of K0011 
power wheelchairs were lower than the Medicare reimbursement amount.  The prices we 
obtained for K0011 power wheelchair models varied widely, from a low of $999 to a 
high of $16,995.  Ninety-four percent of the prices we reviewed were below the Medicare 
reimbursement amount.    
 
Compared to the median Medicare reimbursement amount of $5,297, consumers were 
able to purchase K0011 power wheelchairs for a median price of $3,863, suppliers were 
able to purchase K0011 power wheelchairs from two wholesalers for a median price of 
$2,363, and suppliers who negotiated directly with distributors and manufacturers were 
able to obtain K0011 power wheelchairs for a median price of $1,550.  
 
For the models of K0011 power wheelchairs actually supplied to Medicare beneficiaries, 
we found that the median prices to consumers and suppliers were below the Medicare 
reimbursement amount of $5,297.  The median prices for these power wheelchairs were 
very close to the median prices obtained for all the power wheelchairs, with the prices 
ranging from $1,699 to $3,888.  
 
We believe that the program and its beneficiaries could have realized substantial savings 
if the Medicare reimbursement amount for K0011 power wheelchairs more closely 
resembled the costs to consumers and suppliers.  If Medicare set the K0011 
reimbursement amount at the median prices available to consumers, the Medicare 
program and its beneficiaries would have saved over $224 million in 2002.  If the 
Medicare program based its reimbursement amount on the median price negotiated by 
suppliers with manufacturers and distributors, the program could have saved $586 million 
in 2002. 
 
We did not collect data regarding supplier administrative costs related to furnishing 
K0011 power wheelchairs to Medicare beneficiaries.  Therefore, the median prices 
available to suppliers do not include these associated supplier costs.  These estimates of 
potential program savings would be lower if median prices had included suppliers 
administrative costs.  On the other hand, we would assume that the prices collected from 
websites of suppliers include profit margins and any costs related to billing other insurers.  
We have no evidence to suggest that the costs associated with billing the Medicare 
program are significantly different from the costs of billing other insurers. 
 
I would like to note that MMA reduced the payment amount for certain items of durable 
medical equipments, including power wheelchairs.  As a result of MMA, the price for 
K0011 power wheelchairs is reduced to $5,097. 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 6   CORRECTIVE ACTIONS 
 
Obviously, it is more desirable to prevent fraud and abuse from occurring than it is to try 
and recoup program losses after they have occurred.  To that end, we have worked 
closely with program officials over the years to institute many reforms in the area of 
medical equipment, including consolidating claims processing into four DMERCs, 
enhancing enrollment standards, enacting standards that suppliers must meet in order to 
bill Medicare, and conducting site visits for suppliers. 
 
Given the continuing levels of unacceptable abuses in this area, both for medical 
equipment in general and power wheelchairs specifically, it is critical that additional 
systems improvements and preventive practices be adopted.  The two reports I am issuing 
today make many recommendations for program improvements.  We believe that the 
recommendations in these reports warrant consideration.  Some of these 
recommendations include: 
  
  Evaluate the medical conditions and functional abilities that are associated with 
each of the different types of mobility aids and describe these conditions/abilities 
in the coverage policies; 
 
  Educate ordering providers about Medicares coverage criteria for different types 
of medical equipment, including power wheelchairs, manual wheelchairs, and 
scooters; 
 
  Educate Medicare beneficiaries about coverage criteria for medical equipment 
and supplies, including wheelchairs and scooters, as beneficiaries themselves play 
a key role in ensuring that Medicare does not pay for medically unecessary or 
unused items; 
 
  Create a new coding system for K0011 power wheelchairs that accounts for the 
variety in models and prices for power wheelchairs; 
 
  Use the pricing information obtained as part of our reviews to determine whether 
payments should be reduced; and 
 
  Require DMERCs to conduct frequent reviews of the K0011 procedure code to 
ensure appropriate payments.  This includes ensuring that suppliers have complete 
and thorough documentation.  
 
RECENT EFFORTS TO CONTROL ABUSE  
 
In September 2003, CMS and the OIG issued a joint press release to announce new 
efforts to stem problems with the power wheelchair benefit.  In order to address 
significant increases in allowances for power wheelchairs and indications of improper 
billing activity, CMS has launched a campaign to curb abuse of the Medicare program by 
unscrupulous suppliers of mobility products.  In fact, as part of this campaign, CMS has 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 7   already begun implementing some of the OIG recommendations that I have mentioned 
here today.   
 
For example, initiatives in CMSs campaign include: aggressively scrutinizing new 
applications for supplier numbers; publishing regulations that will enhance CMSs ability 
to screen new supplier applications; and collaborating with law enforcement agencies to 
process fraud cases and ensure application of sanctions, and civil or criminal 
prosecutions.  As part of its campaign, CMS may also revise coverage policy for power 
wheelchairs and scooters to ensure that national policy accurately defines the conditions 
under which Medicare will cover mobility products.  They will adopt a consistent 
approach to medical review; clarify physicians responsibilities as prescribers of mobility 
devices; and educate beneficiaries about Medicare coverage guidelines.  In addition, 
CMS plans to develop inherent reasonableness review guidelines and place power 
wheelchairs first in line for analysis for potential inherent reasonableness adjustments.  
This way, Medicare can be assured that it is paying appropriately for power wheelchairs. 
 
CONCLUSION 
 
Mr. Chairman, as I previously stated, the abuses associated with power wheelchairs truly 
are troubling.  These inappropriate payments waste taxpayer dollars that could otherwise 
fund appropriate equipment for needy Medicare beneficiaries.   
 
Power wheelchairs can greatly improve the quality of life for an individual who suffers 
from limited mobility.  While it is extremely important to preserve this critical benefit 
and ensure that those who truly need power wheelchairs are able to obtain them, there are 
indications that the power wheelchair benefit has been a target for abuse by unscrupulous 
providers; ultimately, these schemes can victimize our beneficiaries.  Wheelchair abuses 
are the latest in a long line in the medical equipment area that the OIG has taken 
concerted efforts to address.  We are pleased that our continued work in this area is 
contributing to heightened awareness related to reimbursement for medical equipment 
and supplies.  
 
We applaud the efforts of CMS and Congress to curb power wheelchairs fraud, waste, 
and abuse while simultaneously preserving the benefit for those recipients who truly need 
power wheelchairs.  We also appreciate your own efforts on both fronts, Mr. Chairman.  
We all must take further steps to eliminate abuses, while continuing to provide a benefit 
that can greatly enhance the quality of life of our beneficiaries.   
 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 8   APPENDIX A 
 
RECENT WHEELCHAIR INVESTIGATIONS 
 
 
(cid:131) In Florida, a man was formally charged with conspiring to defraud Medicare in 
connection with approximately $5 million of fraudulent claims for the cost of 
power wheelchairs and accessories that were allegedly supplied by two DME 
companies.  Under the direction of the companies proprietors, employees of 
these companies conducted staged deliveries of motorized wheelchairs to 
Medicare beneficiaries.  At these staged deliveries, patients were given several 
documents to sign, including delivery confirmation tickets.  The suspects would 
forward the documents along with fraudulent certificates of medical necessity to a 
billing company, which submitted the claims to Medicare for the cost of the 
motorized wheelchairs and accessories.  On August 29, 2003, the man was 
sentenced to 24 months imprisonment and ordered to pay $406,000 in restitution 
for conspiracy to defraud and money laundering.       
 
(cid:131) Another Florida DME company owner conducted a scheme to continue billing 
Federal health care programs while excluded.  In 1997, he was convicted of 
Medicaid fraud and sentenced to a term of community control with intermittent 
confinement and work release.  While on work release, he continued working as a 
sales representative for a DME company.  He continued his fraudulent scheme of 
billing Medicare and Medicaid for high-priced, new power wheelchairs when he 
actually provided used wheelchairs and scooters; he also billed Medicare for 
unnecessary repairs of wheelchairs.  In addition, he opened three DME companies 
using the names of straw nominee owners to circumvent his exclusion from the 
Medicare and Medicaid programs.  Beginning in 1999 and continuing through 
2002, he received over $1 million from Medicare by submitting claims for power 
wheelchairs that were not provided, were used, or were exchanged for scooters.  
He also billed Medicare for unnecessary repairs of the equipment he previously 
provided.  On November 25, 2003, he was sentenced to 37 months in prison.   
 
(cid:131) A Michigan DME company owner persuaded elderly patients to purchase 
motorized wheelchairs they did not need.  He was sentenced on August 21, 2003, 
to 63 months incarceration and ordered to pay $1 million in restitution for 
defrauding Medicare, Medicaid, and a private insurer.  In addition, he forfeited $1 
million in assets obtained through the fraud.   
 
(cid:131) In Georgia, a DME company owner and his business partner submitted numerous 
false claims to Medicare for motorized wheelchairs that were never provided to 
beneficiaries from 1997 through 2002.  The owner and his partner were sentenced 
on May 20, 2003, for their role in this scheme to defraud Medicare.  The owner 
was sentenced to 18 months incarceration and ordered to pay $504,000 in joint 
restitution with his business partner; and the business partner was sentenced on 
May 1, 2003, to 30 months incarceration.   
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 9   (cid:131) In California, Medicare reimbursed a DME company owner for power 
wheelchairs and other medical equipment that were never provided to 
beneficiaries.  He was sentenced on August 18, 2003, to 33 months confinement 
and ordered to pay $249,000 for health care fraud.   
 
(cid:131) In Pennsylvania, an OIG investigation revealed that, through a marketing 
program, Pride Mobility Products Corporation, a manufacturer of power 
wheelchairs, scooters, and lift chairs, solicited and received monthly payments 
from suppliers in return for referring sales leads to those suppliers.  On October 
22, 2002, the company agreed to pay $80,000 to resolve its liability for violations 
of the kickback provision of the Civil Monetary Penalties Law.  In addition to the 
payment under the settlement agreement, the company was also required to adopt 
and implement certain compliance measures. 
 
(cid:131) In North Carolina, from January 1999 through April 2000, the owner of a DME 
company billed Medicare for power motorized wheelchairs when he actually 
provided beneficiaries with less expensive scooters.  The company owner was 
sentenced on April 25, 2002 to 13 months in prison and ordered to pay $200,000 
in restitution for mail fraud.   
 
(cid:131) A Texas DME company was involved in a scheme that provided motorized 
scooters and wheelchairs to Medicare beneficiaries, but billed Medicare and 
private insurance companies for equipment that was either not medically 
necessary or was more expensive than the equipment actually provided.  The 
company was ordered to pay a $10,000 fine on February 21, 2002, for mail fraud 
and wire fraud.  The companys owner was sentenced on February 22, 2002, to 18 
months imprisonment and ordered to pay $300,000 in restitution for mail fraud.  
A salesperson was ordered on February 28, 2002, to pay $85,000 in restitution for 
wire fraud.   
 
United States Senate Committee on Finance  
Hearing:  April 28, 2004    Page 10