Mississippi Businessman Admits $19M Medicare Fraud in DME Kickback Scheme

The guilty plea of Mississippi businessman Willie De Gibbs highlights yet another major fraud operation exploiting weaknesses in Medicare oversight and the wider US health care reimbursement system. Gibbs admitted to orchestrating a $19 million scheme centred on the purchase of fraudulent doctors’ orders and the systematic billing of medically unnecessary orthotic braces through seven durable medical equipment (DME) companies. By operating through both personally owned entities and firms held via straw owners, he created a network designed to obscure beneficial ownership and circumvent scrutiny.

This case reinforces a growing trend in financial crime where health care fraud converges with complex corporate structuring and illicit payment flows. Kickback-driven DME schemes remain one of the most consistently abused channels for siphoning funds from government insurers, often enabled by weak controls around provider enrolment, insufficient verification of medical necessity and limited transparency around ownership. Financial institutions should be alert to the red flags arising from these operations, including rapid spikes in billing activity, unusual payment flows between related entities and the use of multiple shell DME suppliers with overlapping control.

The Justice Department’s Health Care Fraud Strike Force continues to expose large-scale, coordinated fraud networks, signalling increased enforcement focus on DME-related misconduct. With Medicare losses from fraud exceeding $30 billion since 2007, this latest conviction underscores the essential role of robust due diligence, ongoing monitoring and strengthened beneficial ownership verification across the sector. For firms operating in the financial system, the case demonstrates how health care fraud remains a high-risk typology requiring proactive detection, particularly where fabricated medical documentation and suspect reimbursement claims generate suspicious financial activity.

Read the press release here.