By Carolyn Jarvis with Global News and Marco Chown Oved with the Toronto Star Global News
Published February 25, 2019
16 min read
“I’m the cleaner,” says the man wearing a ball cap and sunglasses to mask his identity.
“I help them to clean up the books … fix the papers,” he says. “Make it look nice, like a proper pharmacy.”
We’ll call the cleaner Ivan. He agreed to share details of the murky world of pharmacy fraud — a scam that costs the public millions every year, but no one knows exactly how much.
Ivan is the man pharmacists call when they have been flagged for overbilling the Ontario Drug Benefit Program (ODB), sometimes for hundreds of thousands or even millions of dollars. He comes in and creates a paper trail to hide the fraud and get pharmacists off.
The pharmacists are “scared, afraid,” when they first call, he says. “The possibility exists that they’re going to jail. It’s fraud.”
WATCH ABOVE: An explosive investigation detailing how some pharmacists are making big bucks by scamming the Ontario Drug Benefit Program.
But Ivan, who has a long, documented history in the health care field, “knows the system really well.” Ministry of Health auditors look for drugs the pharmacy billed for but never had in stock. Ivan creates fake transfers from other pharmacies to make those drugs appear in the inventory.
Ivan, who says he has helped disguise fraud at more than 100 Ontario pharmacies over the last five years, says it’s easy to hide the evidence.
He coaches pharmacists on how to fool the auditors.
“You say, ‘Oh, I forgot about this. … We never scanned it, we never entered it. … We transferred that medication two months ago from (another) pharmacy and it was never put in the system.”
Sometimes the auditors give notice that they are going to inspect a pharmacy and Ivan comes and fixes the books ahead of time.
“Three hours,” is all he needs, he says, chuckling. “No problem.”
WATCH: An explanation of how some pharmacists are scamming the Ontario Drug Benefit Program.
The ODB pays for medications for Ontario’s most vulnerable: children, the elderly and those on social assistance. When a qualified patient fills a prescription, they either don’t pay anything, or pay a few dollars and ODB covers for the rest.
The program costs the province more than $5.4 billion a year.
Pharmacists bill the province every two weeks for medication dispensed to ODB patients and are paid shortly afterwards.
Dishonest pharmacists overbill by tacking extra drugs they never dispensed onto their bills so they are reimbursed for more drugs than they sold. Untold millions earmarked for the sick and needy end up in their pockets.
A Global News/Toronto Star investigation has found a system that struggles to catch fraud and hold those responsible to account.
The investigation reveals:
WATCH: Pharmacist speaks out about how Ontario pharmacy owners may overbill the government to make extra cash
The Ministry of Health recouped almost $40 million in overbilled payments in the last five years. Statistics obtained from a freedom of information request show that once identified, virtually all overbilled amounts are recovered.
This excellent recovery rate is because, most of the time, overbilled amounts are simply “clawed back” from the next payment to the pharmacy. The recovery occurs almost immediately, often years before pharmacists face criminal charges or disciplinary proceedings.
But while the auditors are good at recouping what they have found, there’s evidence to show they’re missing millions more. Ontario’s auditor general identified $4 million of unrecovered overpayments made in 2016/2017 simply by flagging suspicious paperwork — drugs dispensed to dead patients, or birth control pills prescribed to men, for example.
And when it comes to holding pharmacists accountable — even when they admit to overbilling — the system is set up to fail.
In June 2017, Eiman Amin stood in the second floor hearing room at the college of pharmacists and admitted that she overbilled the ODB for nearly $1 million. But she was not charged criminally, nor did she lose her pharmacist’s licence.
Despite having overbilled for “huge quantities of drugs and products” and attempting “to mislead ministry inspectors,” the only punishment she received was from the college, which suspended her license for 16 months and gave her a $5,000 fine. The government recouped its money after Amin remortgaged her house and sold land in Sudan.
Amin ran the Noor Drug Mart on Eglinton Avenue in Mississauga for more than a decade before a ministry audit found she had overbilled $907,039.85 between 2010 and 2012.
In their report, inspectors wrote that the pharmacy had more than doubled its ODB reimbursements by overbilling.
Amin provided fake invoices that overstated her wholesale drug purchases by 726 per cent, according to college disciplinary documents. When confronted, Amin asked for a “favour” and requested they be disregarded.
Amin did not respond to interview requests made through messages left with her children and a detailed letter delivered to her home.
She explained her actions to the college by saying her husband did not have a full-time job and she was the family’s sole provider, responsible for her four children, who she claimed were all living at home at the time of the overbilling.
Citing Amin’s “remorse” and her “difficult personal circumstances, including multiple stressors in her personal life relating to emotional, health and financial issues,” the college decided a licence suspension was appropriate.
She was permitted to return to work as a pharmacist in August 2018.
Anyone who fills a prescription once has their information entered into a pharmacy’s computer. In fraud cases, pharmacists typically use this information to repeatedly fill phantom prescriptions and bill the government.
“So if you came into the pharmacy once, they have your Ontario health card,” said Ivan the cleaner.
“They have that information in the system, and then they can bill that anytime they want.
“There’s so many pharmacies and then there’s a system (that) is not that great, and it’s not red-flagging,” he said. “If you’re not doing the crazy amounts, you’re not going to get caught.”
It’s simply too tempting to tack a few extra drugs onto your bi-weekly bill, especially typical products likely to go unnoticed.
“It’s the smaller, mundane products that equal up to a lot over a given period of time,” said Det.-Sgt. Ted Schendera, who heads the Ontario Provincial Police health fraud investigation unit.
“Smaller products are easier to hide.”
Boxes of Contour diabetes test strips, for example, cost $85 each. Many pharmacies bill for hundreds of boxes each month. A dozen boxes snuck into each bill adds up to tens of thousands of dollars in fraud a year — and that’s just one product. With multiple products, illicit profits can soar into the millions.
After massive frauds involving blood glucose test strips were exposed in the early 2010s, the province changed its reimbursement policy, limiting how many strips ODB will cover.
OPP investigators often discover that not only were the test strips never dispensed, they were never bought by the pharmacy, Schendera said.
“Most of the cases, they’re not ordering the items,” he said. “They never existed.”
Because audits take so long to complete, it makes it difficult for police to make arrests. After an audit, pharmacists have been known to quickly sell their businesses and even “skip the country,” Schendera said.
These fraudster pharmacists often get more money for their pharmacies because the overbilling makes them look more profitable than they actually are.
Said Attalla is one of the few pharmacists in Ontario to be criminally charged with fraud.
Attalla, who has owned 18 pharmacies across the GTA and Golden Horseshoe over the last 20 years, admitted to professional misconduct at the college, but the prosecution of his criminal case fell apart after audit reports were ruled inadmissible and the charges were withdrawn in 2016.
In 2012, Attalla was charged for overbilling more than $355,000 over two years at Rathburn Pharmacy in Mississauga.
After his criminal proceeding, Attalla was brought before the college, where he admitted to professional misconduct relating to more than $406,000 in overbilling at Rathburn and at Supercare Pharmacy, located in Toronto’s Jane and Finch neighbourhood. His pharmacist’s licence was suspended for 30 months, he was ordered to sell his pharmacies, and fined $20,000.
Shortly afterward, Attalla’s life and businesses began to unravel. Three of his pharmacies declared bankruptcy and were seized in 2016. The next year, Attalla stopped paying the mortgage on his 10,000-sq.-ft. Mississauga mansion, which was seized by creditors and sold. Seven months later, he declared personal bankruptcy, listing $1.8 million in debts.
“Yes, I was accused and I was proved innocent by the court, which is a higher level of legal system in Canada, right?” Attalla told reporters from the Star and Global News at his new, smaller Mississauga mansion.
He also said he only admitted fault at the college because he ran out of money to defend himself.
The amount overbilled was clawed back from later payments to his pharmacy, said Attalla, although the ministry would not confirm this.
Attalla said that at the college, he took responsibility for failure to properly oversee his pharmacies’ billings, not for the overbilling itself.
“Because I was the owner, I took the responsibility,” he said. “But I wasn’t working in the pharmacy. I hired people to work for me.”
“The documentation is a thing which unfortunately wasn’t actually very well maintained in the pharmacy,” he said. “I wasn’t able to (find) every single document they asked for.”
“If you read (the decision) very carefully, you see most of (it) is about documentation, not intention to do anything.”
In criminal court, Attalla said, the Crown “didn’t prove what he accused: that I sold drugs on paper that I never bought. He didn’t prove that. He couldn’t prove that. … If you say I billed government for certain drugs that I never bought, then prove it. Prove it.
“They never proved it.”
Attalla’s lawyer, Howard Rubel, declined to discuss his case specifically, but said the Crown often has difficulty proving pharmacy fraud.
“The state of the evidence in many of these cases is rather poor,” Rubel said. “(The ODB) is not set up as a forensic system, so when they try to use it as a forensic system to create proof that can be used in a criminal court, often that proof just doesn’t meet the test.”
That’s why many cases don’t even lead to charges, let alone convictions, Rubel said.
“If they don’t have admissible proof of who entered the prescription, who filled the prescription, who entered the information into the pharmacy’s database, … it’s not even going to make its way into a criminal court.”
Some criminal investigations result in provincial charges under the Ontario Drug Benefit Act. But although such charges could technically lead to up to a year in jail, they generally result in little more than a fine, Rubel said.
“Provincial offences? It’s gonna be the same as a speeding ticket,” he said.
Joseph Salek’s name is emblazoned on the pedestrian bridge over Bayview Avenue at the Canadian National Institute for the Blind, where commuters see it every day.
Salek contributed enough money towards the footbridge’s renovation in 2014 that his name, alongside another donor’s, was erected on it in large white letters.
Only months before, Salek had quietly resigned from the Ontario College of Pharmacists and surrendered his licence after allegations that he overbilled the ODB for $202,386.83 in 2009-10.
Shortly after the bridge was unveiled, Salek pleaded guilty to a breach of the Ontario Drug Benefit Act — a non-criminal offence — for the overbilling and was fined $30,000. He was never charged criminally.
In an agreed statement of facts filed at Newmarket court, Salek said he was not in charge of billing at the Richmond Hill Medical Pharmacy, where the overbilling took place, though he admitted that he “received the monies.”
The manager at pharmacy was also disciplined by the college, which acknowledged “there is no evidence that (the manager) directly benefited,” from the overbilling.
Salek did not respond to requests for an interview. Contacted by phone, his wife, Susan, said, “He is not available.”
His lawyer, Jody Berkes, said Salek paid back the province for the entire overbilling and he also paid the fine.
Before resigning, Salek owned three pharmacies, all of which he sold to another pharmacist, Magdy Salama, for a combined $12.2 million.
The college later found Salama had also overbilled. In his case, it was for $762,000.
But Salama was nowhere to be found. All three pharmacies would close and Salama’s pharmacist licence was revoked in absentia in 2018.
WATCH: Four pharmacists accused of scamming the Ontario government out of millions
Ontario’s auditor general has called out the ODB on four occasions for having too few inspectors.
Hiring more inspections was an AG recommendation in 1996, in 2001, in 2007 and again in 2017.
“There are 4,200 pharmacies; they only inspect about six per cent a year,” said current auditor general Bonnie Lysyk in an interview. “There’s more money to be recovered.”
In 2005-06, the Ministry of Health employed three inspectors and recovered just over $1 million in overbilling. By 2016-17, there were 10 inspectors who recovered $10.3 million.
“Governments don’t like to increase staff because they’re trying to save money. But at the same point, perhaps that will end up recouping more money into the public purse,” Lysyk said.
Her team didn’t inspect pharmacies but still found $3.9 million in inappropriate payments by combing through ODB billings and looking for obvious problems.
They found $910,000 in drugs billed for dead people and $922,000 in drugs billed for people who didn’t need them, such as birth control for men.
“We ran analytics that identified situations that, had they inspected, they likely would’ve been able to recover more money,” she said.
Beyond money, Lysyk says the inspection regime needs to be strengthened to speed up cases where fraud has occurred.
Three different bodies — the Ministry of Health, the OPP and the Ontario College of Pharmacists — are tasked with catching pharmacy fraud. But instead of three times the oversight, the system is clunky and drags out the process over years, sometimes topping a decade. That’s because those agencies don’t work simultaneously, but wait for the others to finish before starting on a case.
The OPP’s health fraud investigation unit does not proactively investigate pharmacies, but waits for cases to be referred from the ministry. Not a single pharmacist was referred for criminal investigation between 2013 and 2015, prompting the OPP to approach the ministry.
That resulted in 13 referrals in 2016-17, but eight were too old to pursue because the pharmacy had been sold or the records were lost, Schendera said.
“We can only investigate what’s referred to us,” he said.
Ayman Mikhael pleaded guilty to Ontario’s biggest pharmacy fraud in the last five years. In July 2015, he admitted to overbilling ODB for $2.5 million between 2009 and 2011.
When Mikhael was caught and cut off from billing the ODB, he was able to transfer patient files to another pharmacy he co-owned with his wife, Safaa Eskander, where the overbilling continued.
As the owner/operator of Wilson Medical Centre pharmacy in Hamilton, Mikhael was audited in late 2011 and found to have been billing for medications he had never purchased.
The ministry passed the file to the OPP, which charged Mikhael with fraud in February 2014. The next year, he pleaded guilty and was sentenced to two years less a day in jail for what the judge called a “massive fraud” that was “well-planned, deliberate and (was) perpetrated over the course of … years.”
In sentencing Mikhael, Judge Maria Speyer said he “deliberately abused his position of trust as a pharmacist.”
In an interview, Mikhael said his life was unravelling while the fraud took place.
“I was having bad debts and I had major depression and it was all snowballing,” he said. “It was just lots of things happening. Bad bookkeeping. Bad supervision. Relying on other people to do the job.”
Speyer noted there was no evidence presented that Mikhael was “living a lavish lifestyle.”
During the time he was defrauding the government, land registry documents show he purchased a $1.1-million mansion near the Mississauga waterfront. After extensive renovations, the opulent residence, which features an indoor swimming pool and movie theatre, was sold for $4.65 million — while Mikhael was in jail.
Mikhael’s pharmacist’s licence was revoked in 2017, following his release from jail.
“I had to sell the house. I had to sell the business, everything,” he told reporters at his doorstep. “I paid more back than I gained.”
Shortly after auditors first uncovered Mikhael’s fraud in 2011, the ODB billing privileges at Wilson Pharmacy were revoked, but patient files were moved to another pharmacy that he co-owned with his wife, Safaa Eskander, where more overbilling took place.
In July 2012, the ministry audited the second pharmacy, MT Cross, and identified $162,000 in overbilling, involving many of the same patient names and drugs Mikhael had admitted to falsely billing.
“I don’t deny anything,” said Eskander, reached by phone.
She declined to comment further, saying, “I am not answering any questions.”
Neither Mikhael nor Eskander were criminally charged for the overbilling at MT Cross.
Eskander admitted to professional misconduct at the college in 2017 and her licence was suspended for 14 months. The ODB overbilling was clawed back by the ministry.
Ivan the cleaner says only two or three per cent of pharmacists who commit fraud — “the sloppy ones” — are caught.
That’s one reason to open up dispensing records to a wider group of health care professionals, said Kelly Grindrod, a pharmacy professor at the University of Waterloo.
“In other provinces, for example, every time a medication is dispensed through a pharmacy, a record is created,” Grindrod said. “And if a physician was to look at the list of medications that had been dispensed for their patient, they could see some of these things.”
With more scrutiny on which medications are being dispensed to patients, we wouldn’t need to rely on a tiny number of inspections to catch pharmacy fraud.
“Ontario doesn’t have this,” Grindrod said. “We should have had this a long time ago. We don’t.”
With files from Chelsea Lecce and Ryan Moore, Ryerson School of Journalism, Jigar Patel, Seneca College, Megan Robinson and Leslie Whyte, Global News, Robert Cribb, Toronto Star, and Sarah Bhola, Centennial College.