Indian-American man admits fraud of more than $5 million

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A Michigan man admitted June 9, 2021, to defrauding victims of more than $5 million in connection with the sale of medical-related business opportunities, Acting U.S. Attorney for the District of New Jersey Rachael A. Honig announced.

Vijay Reddy, 45, of Milan, Michigan, pleaded guilty before U.S. District Judge (District of New Jersey) Robert B. Kugler to an information charging him with one count of conspiracy to commit wire fraud and one count of wire fraud.

A press release from the Acting Attorney’s Office said according to documents filed in this case and statements made in court, that from December 2015 through November 2020, Reddy and his alleged conspirators, David Weinstein and Kevin Brown, advertised business opportunities for sale on various websites.

They purported to sell “blocks” of contracts with medical providers who allegedly wanted to outsource their medical billing, collections, appeals, answering, credentialing, or transcription functions. The buyers would then provide the contracted services to the medical providers and earn a profit.

The conspirators promised to deliver a specified number of providers and pledged that their proprietary marketing efforts would provide a guaranteed client base to the buyers, the press release said.

At least 77 victims sent more than $5 million to accounts controlled by the conspirators. The conspirators spent the victims’ money on personal expenses, including a travel, jewelry, real estate, a wedding and a college education, and other business investments, the press release said.

The wire fraud and wire fraud conspiracy counts are each punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greater. As part of his plea agreement, Reddy agreed to make restitution $5 million. Sentencing is scheduled for Oct. 20, 2021.

The charges and allegations in the criminal complaints against Weinstein and Brown are merely accusations, and they are presumed innocent unless and until proven guilty.