(Image Credit: IMAGN)
Los Angeles, California – A 33-year-old man from Valley Village has pleaded guilty to defrauding Medicare of nearly $16 million through a web of sham hospice companies, in what prosecutors describe as one of the more elaborate fraud schemes uncovered in Southern California’s health care sector in recent years.
Juan Carlos Esparza admitted Monday in federal court to health care fraud and transactional money laundering. From 2019 to early 2023, he and several co-defendants operated a series of bogus hospice providers—one of which, House of Angels Hospice, he owned outright—to siphon money from Medicare for services that were never delivered and medically unnecessary. The remaining three hospices were nominally owned by foreign nationals, though prosecutors say Esparza and his associates exercised complete control behind the scenes.
To conceal their involvement, the group used the names, Social Security numbers, and other identifying details of foreign nationals to open bank accounts, submit applications to Medicare, and sign commercial leases. The scheme relied heavily on false documentation and burner phones registered under fake identities.
According to the Department of Justice, Medicare ultimately paid the four fraudulent hospices nearly $16 million. The money was then laundered through a series of transactions designed to obscure its origins—flowing through shell companies and multiple bank accounts before being spent on vehicles, properties, and other assets. Esparza alone used $90,000 in fraudulent funds to purchase a vehicle.
He is now the latest defendant to admit guilt in the case. Petros Fichidzhyan, a key player in the scheme, was sentenced in May to 12 years in prison after pleading guilty to health care fraud, identity theft, and money laundering. Karpis Srapyan and Susanna Harutyunyan have also pleaded guilty and are awaiting sentencing later this fall. Harutyunyan, a foreign national, faces potential deportation in addition to criminal penalties.
The network was supported by an infrastructure of forged documents and controlled office spaces where records, checks, and credit cards were stored under fake names. Investigators say some of these materials were discovered at the House of Angels office and at residential properties tied to the defendants.
This latest guilty plea underscores a broader federal push to combat systemic fraud in the hospice sector, particularly in Southern California. In recent years, the Justice Department’s Health Care Fraud Strike Force has charged thousands of defendants nationwide with exploiting federal health care programs. Prosecutors say the Los Angeles area has become a hotspot for this type of exploitation, with hospice fraud emerging as a particularly lucrative—and difficult to detect—scheme.
Esparza faces up to 20 years in prison, with sentencing scheduled for October 6. The FBI and the Department of Health and Human Services’ Office of Inspector General continue to investigate the case.
