Feds Warn of Scammers Impersonating DEA Agents

By Pat Anson, PNN Editor

The U.S. Drug Enforcement Administration is once again warning doctors, pharmacists and the public about criminals posing as DEA agents or other law enforcement officers and attempting to extort money from them.

The scammers call the victims, often using caller ID to appear as a legitimate DEA phone number, and threaten arrest and prosecution for violations of federal drug laws unless the victim pays a “fine” over the phone or by wire transfer. Doctors and pharmacists are usually threatened with revocation of their DEA registrations, which allow them to prescribe or dispense opioids and other controlled substances.

A DEA spokesperson told PNN the scam has been going on for years, but the agency has recently seen an uptick in complaints, sometimes hundreds per week.  

“We at headquarters have gotten to the point where we are just inundated with reports of scam calls,” said DEA spokesperson Katherine Pfaff. "And scammers calling us.”

The scammers are now also targeting the general public, according to Pfaff, sometimes claiming that a vehicle intercepted at the border with illegal drugs had been traced back to them.

“No DEA agent would ever contact someone directly like that and insist on payment over the phone or use scare tactics like that. That’s not how we operate,” Pfaff said. “Unfortunately, we have received many reports of people who have actually paid these scammers and lost a lot of money to them.”

The scam tactics continually change, but often share many of the same characteristics. Callers typically use an urgent and aggressive tone, and refuse to speak to anyone other than the intended victim. They demand thousands of dollars via wire transfer or in the form of untraceable gift cards taken over the phone.

Scammers ‘Well Informed’ of DEA Tactics

When calls are made to doctors or pharmacists, the scammers will reference their DEA registration numbers and state license numbers. They also might claim that patients have made accusations against them.

The scammers appear to be aware that many practitioners are already under scrutiny by the DEA for their opioid prescribing practices. In recent years, the DEA has raided and prosecuted hundreds of doctors for alleged infractions. The cases often end with doctors paying a fine rather than face hefty legal bills defending themselves in court.

“The scammers are well enough informed of the tactics DEA is employing against controlled-medication prescribers to be able to replicate them,” says attorney Michael Barnes, who has called for an end to “indiscriminate raids” on doctors.  

“Like the DEA, the impersonators are claiming to have evidence of wrongdoing against licensed health care providers, threatening to revoke DEA registrations, and demanding enormous settlements to make the nightmare go away. The only thing that is missing is the office raid.”

Impersonating a federal agent is a violation of federal law. The DEA urges anyone receiving a  call from a scammer claiming to be with the DEA to report it online to the agency’s Diversion Control Division or by calling 877-792-2873.

DEA Warns Doctors About Extortion Scam

By Pat Anson, PNN Editor

It’s no secret that doctors are under increased scrutiny from the Drug Enforcement Administration and other law enforcement agencies for their opioid prescribing practices.

Last month a North Carolina physician was told to surrender his DEA license by investigators with the state medical board. “They called me on the phone and said they were coming by in two hours to get you to surrender your license,” Dr. Thomas Kline told PNN.

In southern California, a doctor who recently paid a $125,000 fine to settle allegations of illegal opioid prescribing says federal prosecutors threatened to ruin his practice and reputation if he didn’t pay up.

“They could care less if I was innocent or guilty. They wanted to see how much they could gouge out of me,” said Dr. Roger Kasendorf, an osteopathic physician in La Jolla. “It was extortion and there’s nothing I was able to do about it. It’s sad and pathetic.”

It didn’t take long for criminals to realize that other doctors could be vulnerable to extortion. And with no small amount of irony, the DEA’s San Diego Field Division recently issued an unusual alert warning doctors about scam telephone calls from con artists posing as DEA agents, who threaten physicians with arrest and prosecution for violations of federal drug laws.

“DEA continues to receive reports of calls threatening legal action if an exorbitant fine is not paid immediately over the phone. The callers identify themselves as DEA personnel and instruct their victims to pay the ‘fine’ via wire transfer to avoid arrest, prosecution and imprisonment,” the DEA alert warns.

The scam artists – who use fake names, DEA badge numbers or even the actual names of senior DEA officials – threaten to revoke DEA licenses if thousands of dollars are not paid by wire or in untraceable gift cards.

The threat is not an idle one, because doctors cannot prescribe opioid medication and other controlled substances without an active DEA license.

“DEA employees do not contact practitioners or members of the public by telephone to demand money or any other form of payment,” the DEA said. “Notification of a legitimate DEA investigation or legal action is made via official letter or in person.”

The alert urges anyone receiving a telephone call from a person claiming to be a DEA employee demanding money to report the threat using DEA’s online form or by calling 877-792-2873.

Pain Doctor on DOJ Settlement: ‘It Was Extortion’

By Pat Anson, PNN Editor

A southern California doctor who paid a $125,000 fine to settle allegations of illegal opioid prescribing says federal prosecutors threatened to ruin his practice and reputation if he didn’t pay up.

“They could care less if I was innocent or guilty. They wanted to see how much they could gouge out of me,” said Dr. Roger Kasendorf, an osteopathic physician who specializes in pain management in La Jolla. “They tried getting $24 million from me until they saw my bank account. I had to hire a good lawyer and pay them too.

“It was extortion and there’s nothing I was able to do about it. It’s sad and pathetic.”

The U.S. Attorney’s Office in San Diego announced the settlement last week in a press release, alleging that Kasendorf “illegally prescribed opioids to his patients.”

“This investigation arose from data analytics tools which allow the Department of Justice to perform a variety of functions, including identifying statistical outliers, such as which doctors prescribe the highest opioid dosages and which doctors prescribe combinations of opioids and other drugs known to increase the risk of addiction, abuse, and overdose,” the office said in a statement.

“Based on the investigation, the United States contends that Dr. Kasendorf wrote prescriptions for opioids, including fentanyl, that were not issued for a legitimate medical purpose and while not acting in the usual course of his professional practice in violation the Controlled Substances Act and the False Claims Act.”

The DOJ statement makes no mention of any patients being harmed or overdosing while under Kasendorf’s care, and no formal criminal charges were filed against him.

Kasendorf says the DOJ’s case was based on inadequate medical records he kept on five of his sickest patients, who were prescribed relatively high doses of opioids for pain. One of the patients has since died from cancer.

“I didn’t know my EMR (electronic medical records) very well. I didn’t keep good notes. And as a result, they went through my notes and said, ‘Oh look you didn’t do this and you didn’t do this.’ I did, but I kept poor documentation,” Kasendorf told PNN.

“Nowadays, if you see any of my notes over the last three years, they’re perfect. But back in the day I didn’t have great notes.”

DR. ROGER KASENDORF

Kasendorf has a simple explanation for why he agreed to settle rather than defend himself in court.

“It was cheaper to pay it than defend it. So, I just paid it,” he said. “If I didn’t settle, they said they would call the DEA and then the state (medical) board. That’s what they said. ‘If you don’t settle, we’re going to make it a lot worse for you.’   

“If I defend myself, I’m risking my (medical) license, even though I don’t feel like I did anything wrong. Now I’m dealing with three separate entities and then I can’t work anymore. So I almost had no choice but to settle.”

“Without reviewing the medical records, I cannot assess the fairness of this outcome,” says attorney Michael Barnes, who is managing partner at DCBA Law & Policy, a law firm that advises healthcare providers. 

“If the physician were merely a big-data outlier because he took on patients with the most complex needs, and if his prescribing were CSA (Controlled Substances Act) compliant, then the behavior of the federal government would fall squarely under the Black’s Law Dictionary definition of extortion.”

That legal dictionary defines extortion this way: “Any oppression by color or pretense of right, and particularly the exaction by an officer of money, by color of his office, either when none at all is due, or not so much is due.”

Assistant U.S. Attorney Dylan Aste, who led the case against Kasendorf, did not respond to a request for comment. As for the doctor’s claim about extortion, a DOJ spokesperson told PNN, “We’re not going to have any comment about that.”

DOJ Threatens Criminal Prosecution

Kasendorf is the latest example of the DOJ’s heavy-handed tactics in fighting the opioid crisis. Dozens of doctors around the country have been arrested and prosecuted for illegal opioid prescribing, many of them targeted by DOJ task forces that use prescription drug databases to identify high-dose prescribers.

"Sometimes the only difference between a doctor and a drug dealer is a white coat," U.S. Attorney Jay Town told reporters after federal raids in April that resulted in criminal charges against 60 practitioners in seven states.

Those cases may be legitimate, but hundreds of doctors who face no charges are still being harassed by federal prosecutors – not because their patients became addicted or overdosed – but because their names turned up in a database search.

In February, U.S Attorneys in Wisconsin sent letters to 160 high-dose prescribers in the state, warning them that “prescribing opioids without a legitimate medical purpose could subject them to enforcement action, including criminal prosecution.” 

“The DOJ treats controlled-medication prescribers, especially big-data outliers, as though they are guilty unless proven innocent.”

— Michael Barnes, attorney

Similar warning letters have been sent to doctors in Georgia, Massachusetts and other states.

“The DOJ treats controlled-medication prescribers, especially big-data outliers, as though they are guilty unless proven innocent,” said Barnes. “Detailed medical records are the only affordable way for a provider to prove his innocence — or at least make the prosecutor think twice about proceeding with criminal charges.”

Although the DOJ lacked credible evidence that any of Kasendorf’s patients were harmed by his care, the lack of detailed medical records was enough to intimidate the doctor into settling on the advice of his attorney. 

“Dr. Kasendorf’s ability to provide high quality pain management to those in need of treatment never was questioned. No charges ever were filed against Dr. Kasendorf,” said attorney Robert Frank. “The government’s allegations arose from an incomplete story of Dr. Kasendorf’s care for a few patients.  No patients suffered any adverse outcomes or complications from his care.   

“Economically, it made sense for Dr. Kasendorf to put an end to yet another Government pursuit of a physician successfully treating patients for true chronic pain problems, in what now has become an opiophobia world brought on by the overzealous promotion of opioids by pharmaceutical companies and misuse of them by relatively few physicians, Dr. Kasendorf excluded.“ 

‘Glad I Found Dr. Kasendorf’

Kasendorf continues to practice medicine and remains in good standing with the Osteopathic Medical Board of California. The board has no record of any disciplinary actions, malpractice judgments or citations against him.

Online reviews of Kasendorf by patients are largely positive.  

“I am so glad I found Dr. Kasendorf. I have dealt with debilitating neck pain for years. Dr. K treated my neck and my pain not only went away, but my headaches and numbness in my fingers went away also. He is very good at what he does,” wrote Gina in a Yelp review.  

“Dr. Kasendorf is one of the most caring pain management doctors I have ever seen, and I have seen a lot of them. He is truly empathetic towards his patients which is very hard to find. He is very strict about his opiate contract rules, but most pain management doctors are nowadays,” wrote Natalie. 

“He fired me from treatment with opiates despite a chronic painful condition,” wrote Gary, who said Kasendorf cut his opioid medication in half and then dropped him for being non-compliant.

“He is afraid the DEA is going to threaten his practice. Suggest you find an MD with the integrity to stand by his patients and stand by his past decision to prescribe opiates.” 

Guilt by Association 

Federal prosecutors initially became interested in Kasendorf not because of his prescribing practices, but because of his association with Insys Therapetics, a controversial Arizona drug maker.  

Insys’ founder and four former executives were recently convicted of bribing doctors with millions of dollars in kickbacks to prescribe the company’s flagship product: Subsys, a potent fentanyl spray that costs about $5,000 for a single day’s supply.

Subsys is only FDA approved for the treatment of cancer pain, but like other drugs it can be prescribed off-label for other pain conditions. Because of its high cost, Medicare and other insurers often wind up paying for Subsys.

Some doctors were paid lucrative speaking fees by Insys to promote Subys, while others were wined and dined at upscale restaurants or taken to a strip club for free lap dances.   

Kasendorf was a promotional speaker and consultant for Insys from 2013 to 2017. For that he was paid over $167,000, according to ProPublica.

“I was starting my practice. I had no money. The fact I was able to earn money through speaking was a miracle for me. That’s what kept me afloat and my family when I first moved here,” said Kasendorf, who moved to California from the east coast after his home was destroyed by Hurricane Sandy.

“And I was actually good at it. They wanted me to go all over the place because they felt I did a good job and was very thorough. I made it entertaining. I’m a very good speaker and I’m very proud of that.”

In addition to Insys, Kasendorf also did promotional speaking and consulting for several other drug companies, including Purdue Pharma, Egalet, Pfizer, Pernix and Indivior. But it was his work for Insys that federal prosecutors focused on.

“I never took bribes. I never got lap dances or all this stuff they were talking about,” Kasendorf told PNN. “This company did a lot of bad things and I completely agree. The problem is their product happens to be very, very good.”  

Subsys was so effective at pain relief that Kasendorf prescribed it to all five patients who were flagged by DOJ investigators.

“After all this time and all this effort, I think DOJ was upset I didn’t have more money.”

— Dr. Roger Kasendorf

It’s not the first time the DOJ has gone after a doctor for prescribing Subsys and making speeches for Insys. In 2017, the DEA raided the home and clinic of Dr. Forest Tennant, alleging that he took kickbacks from Insys and ran a “drug trafficking organization.” Like Kasendorf, no charges were filed against Tennant, who decided to retire on the advice of his attorneys rather than fight a protracted legal case.    

According to Kasendorf, the DOJ initially wanted him to pay a $24 million fine, but prosecutors settled for far less.

“They were so upset when they saw they could only get $125,000. But I sent them all my records and they could see I literally had no money in the bank,” said Kasendorf. “I had to borrow $100,000 from my parents to pay them.

“They almost put me out of business. But after all this time and all this effort, I think DOJ was upset I didn’t have more money.”