Lengthy fraud was ‘scream out for help,’ says pharmacist

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A pharmacist has had his registration cancelled for 18 months after he defrauded more than $86,000 from the PBS

The proceedings concerned fraudulent PBS claims the pharmacist had made for medication which he purported to dispense, but did not actually supply, between 2012 and 2016.

These included several claims in which the pharmacist also fraudulently wrote or altered scripts, including by forging the signature of prescribers.

The Health Care Complaints Commission originally sought for the pharmacist’s registration to be cancelled with a minimum non-review period of a year, but as the hearing continued, amended this to two years.

It also sought a six-month interim period of non-practising conditions before the period of cancellation came into effect, so that the pharmacist could divest himself of his pharmacy ownership.

The pharmacist had sought to remain in practice for 12 months, with conditions including that he work only as an employee pharmacist, not a pharmacist in charge.

At the Tribunal hearing he admitted that he had been convicted of a criminal offence and that he had engaged in unsatisfactory professional conduct, conceding these were serious enough to amount to professional misconduct.

The Tribunal noted that the fraudulent claims, in which scripts and patient medication records were falsified, were not a “one-off or limited infraction” but something that happened “dozens of times over two locations and over an extended period”.

“This conduct goes to the heart of a pharmacist’s professional duties,” it noted.

Between 2009 to mid-2012, the pharmacist worked in a northern Sydney pharmacy, ultimately as the general manager. Towards the end of that time, the pharmacy’s operator went into receivership.

The receivers claimed the pharmacist was responsible for a significant debt within the company; without conceding liability, he paid them $243,000 in late 2012.

In the middle of that year, he bought a 50% share in a central Sydney pharmacy, and in December 2013 the full ownership of a third pharmacy in the city. A further third share of another pharmacy, which was otherwise owned by family members, was bought in mid-2015.

The pharmacist worked as the main pharmacist in charge at the central pharmacy, and one of three pharmacists-in-charge at the second pharmacy, though he did not generally work at the third pharmacy run by pharmacy members.

A PBS audit of the central pharmacy covering November 2012 to 2013 showed irregularities in scripts in the name of a relative and two other patients, and by July 2016 a Health Department representative told him that all three patients had stated they had not received the relevant medicines.

At this point the pharmacist admitted to the false claims and offered to “pay back every cent and more”.

When asked if he had made any more false claims at the other pharmacies, he said he “had a feeling” that he had also done so at the second pharmacy.

He later disclosed that he had also made fraudulent PBS claims there in the names of three more patients, one of whom was the practitioner himself.

The pharmacist said that the offences had occurred due to “severe unrest in my mind and in my life,” and a desire to “self harm as a way to scream out for help”.

He said he was relieved to have been found out and that he had made full admissions, taking full responsibility for the conduct.

He presented evidence showing that at the time of the offences he was suffering from a major depressive disorder, and that the conduct, which had been likely to be detected, was an “irrational and self-destructive” expression of a depressive illness and unlikely to occur again provided the depression was treated.

The pharmacist advised in November 2017 that he had been charged with a criminal offence regarding the claims at the central pharmacy, leading the Pharmacy Council to hold proceedings of its own in December 2017.

Here the Council determined that a suspension might be “disproportionate” because suspension requires an owner to dispose of any ownership interest in pharmacies.

Instead, it imposed a condition that he not work as a pharmacist and not enter any of the pharmacies he owned – “that is, the conditions were expressly crafted to enable Mr Moawad to continue to run three pharmacy businesses; from two of which he had conducted the admitted frauds,” the Tribunal noted.

In April 2018 the criminal proceedings resulted in a wholly suspended sentence of nine months.

And in September 2018, the HCCC interviewed the pharmacist and brought the current proceedings; by the time of the hearing the pharmacist still had his interest in the first and second pharmacies, though he was no longer a co-owner of the third.

The Tribunal noted that the pharmacist’s evidence about his financial situation was “vague” and sometimes contradictory.

While he said he had not committed the fraud for the money, he also said that he felt under financial strains and that when he bought the 50% stake in the first pharmacy, the lack of remaining funds caused him to “panic”.

It noted that in the 2016 interview with the Department of Health, it became clear that the funds fraudulently obtained from the PBS had become mingled with the business funds; the pharmacist had also failed to disclose the fact that the receivers of his previous employer had asked him to pay them money, nor that he had done so.

Given the central pharmacy was a new business venture at the time, the Tribunal found that the pharmacist was indeed under financial strain and that there had been a “clear” financial motive for the conduct.

The Tribunal decided to reject the characterisation of the conduct as so certain to be detected that it could only be understood as a form of self-destructive behaviour which was a “cry for help”.

It noted that the conduct had been undetected for a considerable period and indeed at the second pharmacy only came to light with the pharmacist’s admission.

It said symptoms of stress and insomnia could have been a “predictable” reaction to the fact that the conduct had been spotted and investigated, and that “there is no contemporaneous corroboration of the practitioner having suffered a major depression or any other form of impairment” at the time in question.

From 2018 to the present, the pharmacist had been working at a pharmacy but did not dispense or undertake any other duties of a pharmacist.

This pharmacy was purchased in April 2018 by the same relative he had previously co-owned with, who was the sole owner – though the pharmacist had helped them by providing $200,000 around the time of the purchase.

He said that this was a loan, but “there was no agreed repayment schedule, no interest, or end date to the loan, and no written or oral agreement concerning the terms of the loan” though he was not a part owner. At the time of the hearing, none of this $200,000 had been repaid to the pharmacist, who said he assumed he would be paid later when the pharmacy was profitable.

The Tribunal also noted that within days of the conduct being detected in 2016, the pharmacist enrolled in an ethics course.

However three and a half years later by the time of the hearing, he still had not completed it.

It concluded that the cancellation of the pharmacist’s registration was required.

It said the circumstances of the offence “render the practitioner unfit in the public interest to practise the practitioner’s profession”.

“His lengthy, calculated defrauding of that system, from two separate pharmacies in which he was the Pharmacist in Charge and had ownership, render him unfit in the public interest to practise,” it said.

It found that the seriousness of the misconduct meant cancellation of registration was the only appropriate order – as a signal to the profession and the public as to how this conduct was viewed, and because “at the present time the Tribunal is not convinced that the practitioner can be trusted in professional practice”.

“The Tribunal’s adverse findings on the practitioner’s credit, and the undocumented, unclear and co-mingled nature of his employment and business interest in his relative’s pharmacy also lead the Tribunal to find that a prohibition order to prevent the practitioner from working as a pharmacy assistant is required,” it said.

“We note that the practitioner saw no conflict of interest or problem in his proposal that he work under conditions in his own pharmacy, notifying his employer (himself) of those conditions and working under a Pharmacist in Charge who was his own employee.

“The practitioner also did not see any cause for concern in his working for his relative in a pharmacy in which he had some ill-defined financial claim.”

It ordered that the pharmacist’s registration be cancelled, effective 30 days from the date of the order so that he could divest his interest in the pharmacies.

Prior to this date, he was not to work as a pharmacist, not to enter any pharmacy in which he has a financial interest, and not work as a pharmacy assistant.

After this date, he is also prohibited to work as a pharmacy assistant.

He will not be able to apply for review of the orders for 18 months, and is expected to pay costs of $14,000.

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