BOSTON (WWLP) – Two Brookline doctors were charged in a superseding indictment on Friday with tax evasion, as well as a conspiracy to defraud the Internal Revenue Service (IRS).
According to the Department of Justice, 49-year-old Dr. Pankaj Merchia of Brookline and 50-year-old Dr. Shona Pendse of Brookline were indicted on two counts of tax evasion and one count of a conspiracy to defraud the IRS.
Merchia and Pendse allegedly conspired to use a fake $30 million transaction as a base to take fake tax deductions and then made false statements about the transaction to criminal investigators, as well as in civil depositions, according to the charging documents.
Pendse allegedly provided her employer with a W-4 claiming her to be tax-exempt which would ensure that her employer would under-withhold federal income tax. It is also alleged that Merchia earned income from third-party business entities between 2017 and 2019, and Pendse earned income in 2019 and 2020, but each of them avoided paying taxes on that income.
According to court documents, Merchia allegedly did two distinct healthcare fraud schemes. Merchia allegedly billed their former patients’ insurance companies for monthly rentals of Continuous Positive Airway Pressure (CPAP) and Bilevel Positive Airway Pressure (BiPap) machines after the former patients had discontinued their use of the machines and/or returned the machines to Merchia’s office years prior. It is also alleged that Merchia used the money of this fraud to purchase a home in Brookline.
Merchia also allegedly billed the insurance company of a family member over $400,000 for a monthly rental of a CPAP machine, before knowing that the insurance would not pay for treatment rendered by a family member. Merchia then allegedly used the proceeds of this fraud to fund a wire transfer of $250,000 and to purchase at least $140,000 in securities.
The charges of money laundering and health care fraud are a sentence of 10 years in prison, three years of supervised release, and a fine of up to $250,000. The charges of tax evasion and conspiracy to defraud the IRS are a sentence of up to five years in prison, three years of supervised release, and a fine of up to $250,000.