Doctor Pleads Guilty to 401(k) Embezzlement

The United States Attorney’s Office for the Middle District of Pennsylvania announced that Timothy Clark pleaded guilty on April 22 in federal court in Harrisburg, Pennsylvania, before U.S. District Judge Christopher C. Conner. Clark, who is the sole owner of Central Pennsylvania Pulmonary Associates (CPPA) and Sleep Disorder Centers of Central Pennsylvania, pleaded guilty to embezzlement from an employee benefit plan, executing a scheme to defraud health care benefit programs in connection with the delivery and payment of healthcare benefits and money laundering.

Clark is scheduled for sentencing on July 29, 2013.

In June 2012, Clark was indicted on charges that from July 2010 through December 2011, as CPPA’s owner and trustee of the company’s 401(k) plan, he withheld employee 401(k) contributions and failed to deposit the withheld funds into their 401(k) plan. Clark instead maintained the employee 401(k) contributions in bank accounts that he controlled, causing his employees to lose approximately $25,000 of their retirement funds.

In July 2012, Clark was indicted on charges that from December 2007 through September 26, 2008, Clark, who provided critical care services to patients of Holy Spirit Hospital, intentionally inflated the amount of time the health care providers he employed spent with each patient, thereby fraudulently inflating the health insurance claims he submitted to Medicare, Highmark, Inc., and Capital Blue Cross. The dollar amount of the fraudulent claims exceeded $500,000. In the indictment’s six money laundering counts, Clark was charged with transferring approximately $103,000 obtained through the health care fraud to CPPA payroll and money market accounts.

Both cases are being prosecuted by Assistant United States Attorney Joseph J. Terz.