LOS ANGELES – A former resident of Aliso Viejo who submitted fraudulent bills to insurance companies that sought well over $8 million for tests and services that were never performed was sentenced today to 97 months in federal prison.

Michael Mirando, 40, who currently resides in Portland, Oregon, was sentenced by United States District Judge Percy Anderson, who also ordered Mirando to pay just over $3 million in restitution. At the conclusion of today's hearing, Judge Anderson – who called the defendant “totally unrepentant” – remanded Mirando into custody.

Following a one-week trial, Mirando was found guilty in May of 15 counts of health care fraud. The federal jury deliberated for less than 30 minutes before issuing its verdicts.

The evidence presented during the trial showed that Mirando – who was an owner of Holter Labs, LLC, which provided cardiac monitoring services using an ambulatory electrocardiography device known as a Holter recorder – defrauded dozens of private insurance companies by submitting millions of dollars in claims for services that were never performed. Mirando handled most of Holter Lab's business activities, including purchasing the Holter recorders, advertising, managing the company's finances, and submitting the medical claims to the patients' insurance companies. Holter Labs was based in Laguna Niguel until Mirando moved the company to Portland in 2012.

Holter Labs provided the Holter recorder to physicians, who prescribed the devices to monitor patients' heart rates for one to two days. Mirando then billed the patients' insurance companies for the prescribed 24- or 48-hour tests, but he also submitted bills for services never ordered – such as 30-day tests – and for services the device could not perform – such as brain scans and oxygen studies.

From 2005 through 2016, Mirando submitted tens of thousands of claims to health insurance companies, some of which were for services legitimately performed. But Mirando also submitted bills “for services that doctors never ordered, patients never received, and that the Holter devices never performed and, in many cases, were incapable of performing,” according to documents filed by prosecutors.

The bills submitted to 26 health insurance companies sought approximately $10.3 million, which included approximately $8.4 million for tests that his company's heart rate monitors never performed and were unable to perform. The victim health insurance companies paid about $3 million on these fraudulent claims.

Mirando was “the scheme's primary beneficiary,” prosecutors wrote in their sentencing memorandum. “He controlled Holter Labs' finances, diverted most of the fraudulent proceeds from his business partner, and paid to himself the majority of the proceeds from fraudulent scheme. And [Mirando] continued submitting his fraudulent claims even after being indicted and arrested.”

After Mirando admitted that he purchased his house in Portland with proceeds generated by the fraud scheme, Judge Anderson recently signed a preliminary order of forfeiture for that residence.

The case against Mirando was investigated by the Federal Bureau of Investigation.

The case was prosecuted by Assistant United States Attorneys Michael G. Freedman and Katherine A. Rykken of the General Crimes Section.

Component(s): USAO – California, Central

Press Release Number: 17-195 Updated October 31, 2017

Central District of California DOJ / 17-195 / October 30, 2017