Ohio man pleads guilty to laundering $3.4M in health care fraud case

An Ohio man pleaded guilty to laundering approximately $3.4 million in illicit health care fraud proceeds through multiple regional banks on behalf of a transnational criminal organization, according to the Department of Justice.

Eldar Zarbavel, 45, of Pepper Pike, Ohio, served as a money launderer for the foreign-based organization behind what prosecutors describe as the largest health care fraud case ever prosecuted by the Justice Department, uncovered through an investigation known as Operation Gold Rush. The organization is based in Russia and elsewhere. Zarbavel is the 16th individual convicted in connection with the scheme, which has led to charges against 35 people to date, the department said.

The organization allegedly orchestrated a multi-billion-dollar health care fraud and money laundering scheme targeting Medicare and private insurance companies. According to charging documents, the group deposited insurance reimbursement checks obtained through fraud, exploiting the fact that the funds initially appeared legitimate because they originated from Medicare and established insurers. The organization allegedly circumvented internal bank controls and, in some cases, coordinated with associates employed at the banks to gain access to the U.S. financial system.

To open financial accounts, the organization allegedly supplied nominee owners with false sale documentation and false corporate registration papers, disguising the true ownership and control of various fraudulent durable medical equipment companies and their financial accounts. Fraud proceeds from Medicare and other insurers were then funneled into those accounts before being siphoned to shell companies and overseas banks, according to the department.

Zarbavel opened bank accounts in Northeast Ohio for Royce Medical Supply LLC, a Florida-based durable medical equipment company. Between July 2022 and July 2024, the organization submitted $1.42 billion in false and fraudulent claims to Medicare and other insurers through the company, according to the release. While the Centers for Medicare & Medicaid Services suspended reimbursement on nearly all the claims, some were paid. Between June and July 2024, Zarbavel facilitated the deposit, transfer and withdrawal of approximately $3.4 million in fraud proceeds at the direction of organization members and for the organization’s benefit.

Zarbavel pleaded guilty to one count of money laundering and faces a maximum penalty of 20 years in prison. He is scheduled to be sentenced Dec. 16, with a federal district court judge to determine the sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The announcement was made by Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division; HHS-OIG Acting Deputy Inspector General for Investigations Miranda L. Bennett; and FBI Detroit Field Office Special Agent in Charge Jennifer Runyan. HHS-OIG and the FBI are investigating the case, which is being prosecuted by attorneys from the Criminal Division’s Fraud Section.