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Hammond woman gets prison for bilking Medicaid out of $1.8M

A Hammond woman asked a federal judge for leniency Wednesday, saying she knew she was breaking the law when she defrauded Indiana Medicaid out of almost $2 million but that she used the money to support her daughter and help disabled neighbors in need.

However, U.S. District Judge Joseph Van Bokkelen said he also thought Phyllis Lark, 46, spent the money on herself and denied her request for probation, instead giving her three years and a month in prison.

“I think at the end of the day there was one reason you did it: greed,” he told her during her sentencing hearing at U.S. District Court in Hammond.

Lark pleaded guilty earlier this year to stealing $1.86 million from Medicaid through a scheme of falsely billing for medical services she never provided. She used the Social Security numbers of dead people, according to her attorney, Walter Alvarez.

Lark said she started the scheme after she and her co-defendant, Austin Nwaka, who is from Africa, had a child together in 2006. She didn’t have enough money and so, even though she knew it was wrong, she started the fraudulent billing, which between the two led to a total loss of more than $3 million.

“I know what I did was wrong,” she said.

Nwaka has fled the country, and Lark said she has done and will continue to do everything she can to help track him down and will testify at his trial if he is ever caught.

Alvarez defended his client, saying she suffered from sexual abuse as a child and was a woman in poor health whose family suffered from a history of poor health.

“She got caught in temptation; she got conned by a guy,” he said in asking for probation.

Assistant U.S. Attorney Diane Berkowitz did credit Lark with helping the government but said she could not support a sentence without incarceration. She added that the Medicaid program Lark stole from is designed to help the poor and disabled as a safety net.

Van Bokkelen called the crime, which lasted for several years, sophisticated and dismissed Alvarez’s comments on why the government did not discover it sooner. The judge noted that Medicaid counts on providers to act honestly.

“You jeopardized the system,” he told Lark.

Along with prison time, Lark must pay back the $1.8 million in restitution, although Alvarez said during the hearing it is unlikely she will ever do so.

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