Lab Salesmen Admit Bribing Doctors for Referrals

The president of a Parsippany-based medical laboratory and six salesman working either for or with the lab pleaded guilty Monday to charges of conspiracy and money laundering after authorities said they illegally paid doctors for referrals to their company.

Biodiagnostic Laboratory Services (BLS) President David Nicoll, 39, of Mountain Lakes and Scott Nicoll, 32, of Wayne, a BLS employee and David Nicoll’s brother, were among those who pleaded guilty to one count of conspiracy to violate the Anti-Kickback Statute and Federal Travel Act and one count of money laundering in Newark federal court, according to U.S. Attorney Paul Fishman.

Other employees and associates who pleaded guilty to the same charges include Craig Nordman, 34, of Whippany; Kevin Kerekes, 47, of Florham Park; Doug Hurley, 33 of Hillsborough; Luke Chicco, 40, of Garden City; and Cliff Antell, 38, of Rumson.

If convicted, each face a possible maximum penalty of five years in prison and a $250,000 fine on the conspiracy charge and 20 years in prison and a $500,000 fine on the money laundering charge.

"Individual greed has no place in a treatment plan, and people seeking medical help deserve to know a doctor's recommendations are based on professional expertise, not illicit profits," Fishman said in a release. "Today is an important step but we aren't finished holding criminals responsible for this conspiracy, or who break the law to put profits over patients."

The BLS employees allegedly offered doctors money to send their patients to the lab for blood samples between 2006 and 2013. Some doctors were paid a per test fee to entice them to order more blood tests than necessary, Fishman said. The lab would then collect insurance money, including more than $100 million from Medicare and private health insurance companies Fishman said.

The bribes offered to doctors came in the form of cash and through sham lease and contract agreements.

One of the doctors, Frank Santangelo, 43, of Boonton, a physician with offices in both Montville and Wayne, was also charged in April with accepting bribes for several years and violating fidelity to his patients, Fishman said in a press release. The complaint against Santangelo references text messages in which David Nicoll wrote to Santangelo about the status of their referral agreement, stating that BLS “really can’t afford the 40-50,000 [dollars] a month if the girls aren’t going to be drawing any blood." Santangelo allegedly responded by stating, “U no u can count on me!” and “I never let u down!”

As a result of the guilty pleas, David Nicoll will be forced to forfeit $50 million to the United States while his brother, Scott Nicoll, will be forced to forfeit $25 million. The other five salesmen will forfeit between $800,000 and $1.3 million each, Fishman said.

Sentencing for all seven men is scheduled for Sept. 11.

The charges against Santangelo and the BLS company as a whole are still pending, Fishman said.