Last July, the state attorney general's office charged Jamestown pharmacist Anthony T. Rizzo with submitting thousands of phony prescriptions to defraud the Medicaid system out of $2 million.
Last week, the U.S. Justice Department accused him of running other fraud schemes, including one that allegedly enabled him to buy $3 million worth of drugs at huge discounts. His case was described by prosecutors as one of the biggest fraud cases compiled against a pharmacist in Western New York.
But as of Monday, the state agency that licenses pharmacists said Rizzo is "in good standing" with no disciplinary actions filed against him.
"At this point, he's in good standing," an Albany spokeswoman for the state Education Department said of Rizzo. "He comes up again for re-registration in April of 1998."
Meanwhile, federal prosecutors are seeking forfeiture of Rizzo's pharmacy, a second building he owns next door to the pharmacy, his home at 425 Park St. in Jamestown, a 1993 BMW car, two motorboats and some land he owns near his home, Ms. O'Donnell confirmed Monday. A bank account and an investment account also are sought, with authorities saying in court papers that they seek forfeitures of up to $3 million.
The fact that Rizzo, 52, is still licensed to sell drugs -- nearly five months after his first indictment -- frustrates some investigators in the case.
"Apparently, the Education Department is taking the position that they'll wait and see how the criminal cases come out," one law enforcement official said Monday. "But the frustrating thing is, if they called just one or two doctors, they could verify for themselves that he submitted phony prescriptions, and that would be enough to suspend him."
"I guess they're saying that he's innocent until proven guilty," said Jamestown Deputy Police Chief Lawrence Wallace. "We haven't proven him guilty yet."
Although still licensed to practice pharmacy, Rizzo apparently closed his
shop about two weeks ago, Wallace said.
"There's been no official closing yet that we know of. He still has his signs up, and his merchandise is still in the store," Wallace said. "But he hasn't been open."
There was no answer on the pharmacy telephone Monday and Rizzo and his New York City attorney, Lawrence Hochheiser, could not be reached to comment.
Rizzo said last week that he had no comment on the charges against him or on whether his store would remain in business. He did say he was upset at federal prosecutors for announcing an indictment against him just before Christmas.
Hochheiser said Friday that it is important to note that Rizzo, thus far, is only charged with financial frauds, and not with any crimes that put his customers in physical danger.
These two large fraud cases are now pending against Rizzo:
In July, the state Attorney General's Medicaid Fraud Bureau charged him with bilking the state Medicaid system out of $2 million, and the EPIC (Elderly Pharmaceutical Insurance Coverage) program out of $65,000. Prosecutors said Rizzo submitted 8,000 phony prescriptions to area doctors and received the money for them without providing drugs. He has denied those allegations and no trial date has been set.
Interim U.S. Attorney Denise E. O'Donnell announced Friday that a grand jury indicted Rizzo on charges of wire and mail fraud, health-care fraud, conspiracy and money laundering.
In the federal case, Rizzo is charged with falsely listing himself as the operator of a 4,100-bed nursing home -- which would be several times larger than any nursing home in Western New York -- so he could join a buyers' group whose members received a 60 percent discount on millions of dollars in prescription drugs.
The federal indictment also charges Rizzo with submitting $117,000 worth of false billings to employee health-care programs, for prescriptions that were never provided. Rizzo has not yet appeared in court on the federal case.
Police said the Rizzo home, located in one of the city's most expensive neighborhoods, includes an in-ground swimming pool and is worth close to $200,000.
Ms. O'Donnell said the forfeiture actions are under the federal money-laundering statute. She said Rizzo is accused of buying his home, business property and other possessions with money obtained by fraud.
"It is unusual for us to seek forfeitures in a health-care fraud case. This may be the first time we've done this locally," Ms. O'Donnell said. "You may see a lot more of it in the future, because we do see health-care fraud prosecutions as a priority, both locally and nationally."
The spokeswoman at the state Education Department said the department conducts its own investigations and disciplinary procedures separate from any criminal prosecutions. The fact that a pharmacist has been charged criminally does not automatically mean he or she will face disciplinary action by her department, she said.
The spokeswoman said she could not discuss whether the department is looking at any possible disciplinary action against Rizzo.