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Radiologist Charged In $7 Million Bid Scheme

July 22, 2013
Written by: , Filed in: Medical Ethics, Practice Management
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A Kansas radiologist is among three people charged with rigging $7 million in federal contracts for radiology equipment, facilities, services, and staff.

The radiologist, 50-year-old Heidi L. Webster, MD, of Manhattan, Kansas, was a U.S. Army officer from 1995 to 2006. Co-defendant Lawrence Peter Fendi, 42, of New Braunfels, Texas, is a retired Army master sergeant and former chief administrator of the radiology department at Brooke Army Medical Center at Fort Sam Houston, Texas, near San Antonio. Also charged is John Walter Hoffman, 43, who owns Hoffman Surgical Devices in San Antonio.

The Internal Revenue Service and prosecutors say Fenti and Dr. Webster abused rules that give preference to “small disadvantaged businesses“—businesses with majority owners who are members of groups that are both socially and economically disadvantaged. The two are accused of using an officially designated small disadvantaged business, Data Dynamics Inc. of Grafton, North Dakota, as the primary contractor to disguise the fact that companies run by Dr. Webster, MRI Resources Inc. and Pro Veteran Staffing Inc., were actually doing the work and getting most of the money.

Dr. Webster, Fenti, and Hoffman are charged with wire fraud and conspiracy to commit wire fraud. Dr. Webster and Fenti are also charged with bribery, and Hoffman is charged with money laundering. Lawyers for Dr. Webster and Hoffman said their clients would plead not guilty. Fenti’s lawyer did not immediately comment on his client’s plans. Dr. Webster’s lawyer, Dan C. Guthrie of Dallas, said:

Dr. Webster intends on vigorously defending not only her freedom but her professional reputation.

He was quoted in a San Antonio Express-News story.

Dr. Webster and Fenti worked together both at Irwin Army Community Hospital at Fort Riley, Kansas, and at Brooke Army Medical Center. Prosecutors said Fenti’s position at the Brooke radiology department allowed him to steer contracts to Data Dynamics. Data Dynamics subcontracted with MRI Resources and Pro Veteran Staffing, which submitted inflated invoices to Data Dynamics, prosecutors said. They said Data Dynamics then overcharged the Army.

Court filings say Dr. Webster paid Fenti about $422,485 in kickbacks and paid $120,000 to Fenti’s lawyer. The indictment says Hoffman’s company was inserted as an unnecessary layer in the contracting structure so Fenti could get kickbacks.

Neither Data Dynamics nor its owner, Gail Martinson, has been charged. In court documents, Martinson said her company did nothing wrong.

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One Response to “Radiologist Charged In $7 Million Bid Scheme”

  1. Radiology Daily»AlertArchive » Radiologist Gets 30-Day Contempt Sentence on August 5th, 2013 at 11:16 am

    […] $7 million in federal contracts for radiology equipment, facilities, services, and staff, as we reported two weeks ago. Dr. Webster, who was a U.S. Army officer from 1995 until 2006, is accused of conspiring to abuse […]