GUILTY: Daniel Kandler Pleads Guilty To 2018 Patient Brokering Charges, Sentenced To 4 Years In Prison

UPDATE

Daniel Kandler, the former owner of Chapters Recovery Treatment Center, has been found guilty of patient brokering.

After a 4-year court battle, Kandler has pleaded guilty to an additional 14 counts of patient brokering after a jury found him guilty of 48 counts.

Kandler entered into a plea agreement that will allow him to serve time concurrently, setting his sentence to 48 months.

Originally Reported First By Boca Post

BOCA RATON, FL – Boca Post (BocaPost.com) — Daniel Kandler, who was originally arrested in 2018 for patient brokering is back in jail this morning following a court order as part of the legal proceedings.

Kandler was the subject of a Sober Homes Task Force investigation in 2017 where detectives say he conspired with a group of individuals to commit patient brokering.

According to court records, the state filed the following charges in 2018 following his arrest:

• 14 counts of 817.505(1A4) PATIENT BROKERING
• 1 count of 817.505(1B4) CONSPIRACY TO COMMIT PATIENT BROKERING

According to arrest records, Daniel Kandler now lives on Destiny Drive in Dakota, a western Delray beach gated community. At the time of the original arrest, he was a resident in The Oaks community in Boca Raton.

What is Patient Brokering?

In Florida, Patient Brokering is a type of health care fraud defined in Florida state statute 817.505. Typically, patient brokering is committed by healthcare providers accepting some sort of kickback in exchange for patient referrals.

Daniel Kandler Arrest Affidavit

The original narrative from the probable cause affidavit as submitted by Palm Beach Sheriff’s Office in 2018 can be found below:

In early 2017, I participated, as a member of the Office of the State Attorney-Sober Homes Task Force, in an investigation of Impact Q Testing LLC (“IQ”), a clinical laboratory located at 2234 W Atlantic Ave, Delray Beach, FL. Clinical laboratories in Florida are considered health care providers requiring licensure by Florida’s Agency for Health Care Administration (“AHCA”).] From December 2015 thru January 2017, Daniel Kandler was listed in Florida Department of State (Sunbiz) records as both registered agent and “MGR” of IQ.

In the course of that investigation, a subpoena was issued for their bank account records IQ. In a review of the certified Bank of America records for the account of IQ received 3/22/17, I identified 10 checks issued from 9/16-1/17 totaling over $400,000 all payable to John Rizzo or LLCs affiliated and controlled by John Rizzo (Southern Transfer LLC, Idamia LLC, and Idamia’s successor: Aver Rx, LLC.) John G. Rizzo is a convicted federal felon currently on supervised release in Palm Beach County, FL.

On 5/2/17 analyst S. Pentecost and I met with John Rizzo at the U.S. Courts Office at 501 S Flagler Dr, WPB, FL. Also present was Rizzo’s federal probation officer, John Minnelli. In a sworn statement, Rizzo said he knew Danny (Daniel) Kandler, principal of IQ because they both live in the Oaks community in Boca Raton, Fl. Rizzo said he started working at IQ in July 2016. Rizzo said he was also involved in business activities with two other principals/officers of IQ: David Remland and Mark Desimone.

On 11/16/17 ASA J. Chapman, Analyst S. Pentecost, and I met with John Rizzo and his attorney, Tama Kudman. At this meeting, Rizzo elaborated on his statements made at the 5/2/17 meeting. Rizzo said that in early 2016 he had an agreement with UTC Laboratories in New Orleans, LA, under which he would receive approximately 50% of the collected insurance claim receipts to UTC for all of the Urinalysis (“UA”) cups that he was responsible for delivering from his treatment center clients. He said he brought Safe Harbour Recovery Treatment Center(“Safe Harbour”) in West Palm Beach, FL to UTC. He said he was working with Hunter Johnson, Naim Cephas, and Chris Norris. He described them as having a relationship with Safe Harbour, and they brought Safe Harbour to Rizzo and Rizzo arranged for their UA cups to be sent via FedEx to UTC. Rizzo said he met with Alex Kane and Jocelyne Martorano, and later with Chris Martorano, husband of Jocelyne, at Safe Harbour. Florida Department of State records list Jocelyne Martorano as a partner in both Safe Harbour Recovery Group, LLC and Safe Harbour Recovery-Boynton LLC. Alex Kane lists his Linkedin profile on social media as Chief Operating Officer of Safe Harbour from 12/15-12/17.

Rizzo admitted that he had no experience in the medical lab business. He said he never went to UTC in New Orleans, and he negotiated a “distributer” agreement with UTC over the phone where they agreed to pay Rizzo 60% of insurance claims receipts after deducting 15% “cost of goods” for UTC. He said it equated to about a 50/50 net split, and it was negotiated in or about November 2015 over the phone from his home office in Delray Beach, FI.

Rizzo said he met with Mark Desimone, who was also a neighbor of his, in April or May 2016, and Desimonetold him he was opening a lab (IQ) and wanted his business. Shortly thereafter Rizzo agreed to move (starting July 1, 2016) the Safe Harbour account for UA’s to IQ.

Rizzo said he personally picked up the UA’s from Safe Harbour and delivered them to
l1Q on a regular basis. Rizzo said he also interacted with Dave Remland, who Rizzo
said was “overseeing 95% of all the lab work” at IQ.

Rizzo reviewed 9 checks totaling $443,362 from the certified bank records of IQ’s Bank of America account to the 2 LLCs (Southern Transfer LLC and Idamia LLC) under his control. He confirmed that these checks were all payments for his referral of UA samples to IQ from Safe Harbour and several smaller treatment center accounts. The 9 checks from IQ’s Bank of America account were as follows:

• PAYEE CHECK # DATE AMOUNT
  • SOUTHERN TRANSFER LLC 1299 1/10/2017 $55,000.00
  • IDAMIA LLC 1298 1/10/2017 40,000.00
  • IDAMIA LLC 1237 12/7/2016 90,000.00
  • SOUTHERN TRANSFER LLC 1236 12/7/2016 60,000.00
  • IDAMIA LLC 1180 11/2/2016 38,000.00
  • SOUTHERN TRANSFER LLC 1179 11/2/2016 60,000.00
  • SOUTHERN TRANSFER LLC 1080 9/8/2016 71,500.00
  • IDAMIA LLC 1084 9/8/2016 24,000.00
  • SOUTHERN TRANSFER LLC 1130 10/10/2016 44862.00

Rizzo said that after he switched the testing of Safe Harbour’s UA samples from UTC to IQ on July 1, 2016, he met at Safe Harbour’s office with Alex Kane and Chris Martorano. In that meeting, Kane and Martorano requested that they also get payments for their UA business from IQ to an affiliated LLC. Rizzo said Kane and Martorano “had somebody that they would set up and that’s where they wanted the money to go.” Rizzo said someone set up an LLC affiliated with Safe Harbour called United “something” (which he later identified as United Recovery Consulting LLC.) Rizzo said he put Alex Kane and Chris Martoranoin touch with Desimone and “they signed the deal” whereby United Recovery would get payments from IQ regarding the UA business that Rizzo referred from Safe Harbour to IQ.

Certified Bank of America records for the 1Q account ending in Hiiiilshow that IQ
made payments to “United Recovery Consultants LLC” from 9/16-12/16 totaling
$182,898. Certified TD Bank records of United Recovery show that all four of these
checks were deposited into the account (ending in Hl) of “United Recovery
Consulting LLC”. TD Bank records also show that this account was opened on 7/20/16
and the “Authorized Representatives/Signers” on the account were Christopher
Kristiansen and Alex Kane, (Kristiansen and Kane were employees of Safe Harbour at
the time that this account was established.) The four checks are as follows:

• CHECK# DATE AMOUNT
  • 1079 09/08/16 $55,600
  • 1127 10/10/16 37,298
  • 1178 11/02/16 45,000
  • 1235 12/07/16 45,000

On 1/30/18 ASA J. Chapman, Analyst S. Pentecost, and I again met with John Rizzo and his attorney, Tama Kudman. We reviewed the 4 payments detailed above from IQ to United Recovery. I pointed out that United Recovery got checks dated the exact same date as 4 of Rizzo’s checks, and the check numbers were sequential (for 3 of the checks and nearly sequential for the 4th) to the checks received by Rizzo. Rizzo explained that when he picked up his checks from IQ, he also picked up the check for United Recovery and delivered the United Recovery check personally to Alex Kaneat Kane’s Safe Harbour office. He said that when he picked up these checks IQ, Desimone would “show me the gross, the collected billables for the month, and then he would tell me what the numbers were, and then he would give it to Shelley and Shelley would cut the checks and then give me the checks.” (Shelley Herman was the accounting manager for IQ and its affiliate, The Good Future Inc./Chapters Recovery.)

Rizzo explained that Desimone was using the promised 70% of collected insurance claims in calculating his payments. He said that the 1st time he picked up the checks (on or about 9/8/16), Kandler was present with Desimone, but the rest of the times he recalled it was just Desimone going over the numbers with him and getting him the checks.

Also at that meeting, Tama provided us with a stack of documents which were all
scanned and placed into evidence. Included were multiple 2016 emails regarding IQ
activities among Desimone, Kandler, and Remland, and also:

1. “MARKETING REPRESENTATIVE AGREEMENT” dated 7/1/16 and effective
   7/15/16 between Impact Q Testing LLC (“IQ”) and Idamia LLC (“Idamia.”) This
   agreement was signed on 7/1/16 by IQ and on 6/28/16 by Olivia “Liv” Rizzo on behalf
   of Idamia, and it provided for $45,000 base monthly payments and “discretionary
   incentive compensation TBD.” Rizzo identified Olivia as his daughter, but he indicated
   that she had no active involvement in Idamia (which he said he managed. )
2. “MARKETING REPRESENTATIVE AGREEMENT?” dated 7/1/16 and effective 7/15/16 between Impact Q Testing LLC (“IQ”) and Southern Transfer LLC (“Southern”). This agreement was signed on 7/1/16 by IQ and on 6/29/16 by Beatrice Rizzo on behalf of Southern, and it provided for $45,000 base monthly payments and “discretionary incentive compensation TBD.” Rizzo identified Beatrice as his mother, but he indicated that she had no active involvement in Southern (which he said he managed.
3. “MARKETING REPRESENTATIVE AGREEMENT” dated 8/1/16 and effective 9/31/16 between Impact Q Testing LLC (“IQ”) and United Recovery Consultants, LLC (“URC”.) This agreement was signed on 9/12/16 by Daniel Kandler on behalf of IQ and ChristopherKristiansen on behalf of URC, and is provided for no base monthly payments but did provide for “discretionary incentive compensation of up to $75,000/month.

On 2/2/18 Det. C. Lunsford and I met with a tech supervisor at the DBPD in Delray Beach, Fl. The tech supervisor said she worked at Safe Harbour in West Palm Beach, FL from 6/2016 thru 3/2017 as an admissions counselor and then as a tech manager. The tech supervisor said that John Rizzo personally picked up UA cups for delivery to a lab. She said that for some portion of her time knowing Rizzo, the Safe Harbour UA’s were going to IQ. She said she had personal knowledge of this, and she sometimes spoke with someone at IQ about specific lab issues such as false positives for UA’s of Safe Harbour patients.

On or about September 19, 2017, Det. Lunsford and I attempted to speak with
Kristiansen and Alex Kane. Both refused to speak with us regarding this
investigation.

On 2/14/18 Det. C. Lunsford and I arrived at 1 Beachway Dr, Ocean Ridge, FL to
attempt to interview Jocelyne and Chris Martorano regarding their roles at Safe
Harbour. Jocelyne answered the door and indicated that she did not want to speak
with us and was planning to retain legal counsel. I told her that we would also like to
speak to her husband Chris. She said Chris was not home, but that he did in fact
reside at this address.

On 3/1/18 Det. C. Lunsford, Analyst S. Pentecost, and ‘met with Christopher
Kristiansen and his attorney, Glenn Roderman. Kristiansen appeared pursuant to a
subpoena to appear dated 2/22/18. He said that he has lived together with Alex Kane
and Ryan Wold in Delray Beach for the past 2 years. He said that before starting at
Safe Harbour he learned that being paid fees per client was illegal.

Kristiansen said that Hunter Johnson first introduced him to Alex Kane, and Kane
offered him a job working at Safe Harbour in May or June 2016. He said Alex was the
CEO of Safe Harbour. Kristiansen was designated as Outreach Coordinator reporting
to Kane. He said Kane ran Safe Harbour.

Kristiansen said he formed United Recovery Consulting LLC at the suggestion of Kane.
He said he was going to become a marketer for IQ. Kane said he could make some
more money from this, and Kristiansen said it “would not require too much time.” He
said it was to market for some treatment centers in California and for IQ. Kristiansen
said that he was introduced to IQ by Kane, and he said Kane introduced him to John
Rizzo of IQ. Kristiansen said he never went to IQ’s lab offices and he never met with
anyone from IQ other than Rizzo.

Kristiansen said he and Alex Kane set up a TD Bank account in the name of United
Recovery. He confirmed that he emailed his signed marketing agreement between IQ
and United Recovery to Rizzo in September 2016 for delivery to IQ. He said that he
received $182,898in referral fees (identifying the 4 checks referenced above) from IQ
to United Recovery from 9/16 thru 12/16. He admitted his only lab marketing account
was for Safe Harbour’s UA labs. He acknowledged that he didn’t have the authority to
designate a lab for use by Safe Harbour, and he admitted that Kane authorized him to
send Safe Harbour’s UAlabs to IQ for testing. CK admitted that he never performed most of the required services under the IQ marketing agreement, he never visited IQ,
and never met anyone from IQ other than Rizzo. He said that the only experience he
had in the UA lab testing business was “peeing in cups” himself. He said Kane set him
up for these payments just because they were friends.

A review of Desimone’s AOL email records obtained from AOL/Oath pursuant to a
search warrant includes numerous emails among Kandler, Desimone, David Remland,
and Rizzo. Those emails include weekly billing reports that detail the Safe Harbour UA
billings by 1Q, and they also include references to a Marketing agreement between IQ
and URC. Certified Bank of America records for the account of IQ referenced above
show that from 8/16 thru 1/17, Kandler personally received total payments. of
$802 585.83 from IQ.

In summary, Daniel Kandler:
1. participated in the initial UA referral payment review with Desimone and Rizzo, and executed the “MARKETING REPRESENTATIVE AGREEMENT” dated 8/1/16 and effective 9/31/16 between IQ and United Recovery Consultants, LLC, all in violation of FSS 817.505(1)(d)

2. conspired with Desimone, Remland, and Rizzo to commit patient brokering in violation of FSS 777.04(3).

Based on all of the above, probable cause exists for the arrest of Daniel Kandler on 1
count of Aiding, Abetting or Participating in Patient Brokering in violation of FSS
817.505(1)(d) and 1 count of Conspiracy to commit patient brokering in violation of FSS 777.04(3).