MEMORANDUM OPINION & ORDER On November 1, 2023, Defendant Roman Israilov pled guilty to conspiracy to commit healthcare fraud and aggravated identity theft in connection with a long-running no-fault insurance fraud scheme. (Nov. 1, 2023 Plea Tr. (Dkt. No. 355)) On May 23, 2024, this Court sentenced Israilov to seven years’ imprisonment and three years’ supervised release, but deferred its determination as to restitution. (May 23, 2024 Sent. Tr. (Dkt. No. 486) at 50-51) The Government now seeks an order requiring Israilov to make restitution to thirteen insurance companies in the aggregate amount of $46,651,801.04. The purpose of the proposed restitution order is to reimburse the insurers for payments they made to medical clinics that were controlled by non-physicians, including Israilov. Under New York law, insurance companies may deny reimbursement claims submitted by medical clinics that are controlled by non-physicians. See State Farm Mut. Auto. Ins. Co. v. Mallela, 4 N.Y.3d 313, 320-21 (2005). Israilov opposes the Government’s application. (See July 8, 2024 Def. Ltr. (Dkt. No. 531); July 30, 2024 Def. Ltr. (Dkt. No. 539)) For the reasons stated below, this Court will enter a restitution order in the aggregate amount of $46,651,801.04. BACKGROUND I. THE INDICTMENT Israilov is charged in United States v. Gulkarov et al., 22 Cr. 20 (PGG), a large multi-defendant case premised on a $40 million no-fault insurance fraud scheme. The Indictment alleges that from approximately 2014 to 2021, Israilov and his co-defendants procured the identity of car accident victims through bribery, steered the accident victims to corrupt no-fault medical clinics willing to pay kickbacks for the referrals, and billed insurance companies for unnecessary medical procedures and medications. The corrupt medical clinics also falsely represented to the insurers that they were owned and controlled by physicians, when in fact they were not. (Indictment (Dkt. No. 1)) The Government alleges that Israilov was a “Clinic Controller,” i.e., one of the leaders, organizers, and managers of the Gulkarov Organization and the No-Fault Scheme. The Clinic Controllers — who are not licensed medical practitioners — owned, operated, and controlled the No-Fault Clinics that engaged in the fraudulent billing for unnecessary and excessive medical treatment under the No-Fault Law. (Id. 8; see id. 15) According to the Indictment, the non-physician Clinic Controllers decided what medical procedures the physicians associated with the clinics would perform and the medications that they would prescribe. Many of the procedures and medications prescribed were medically unnecessary, resulting in the overbilling of insurers. The Clinic Controllers also arranged for the physicians associated with the clinics to falsely represent to insurers that the clinics were physician-owned and physician-operated in order to obtain reimbursement on claims that would otherwise have been denied. (Id.
