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(SAN FRANCISCO) — The president of a Silicon Valley clinical know-how company used to be charged Tuesday with misleading merchants by falsely claiming the company had developed a authorities-popular blood test for the recent coronavirus — the first criminal securities fraud prosecution linked to the COVID-19 pandemic, federal officers acknowledged.
Mark Schena, the president of Arrayit Company, used to be charged with one rely of securities fraud and one rely of conspiracy to commit well being care fraud after authorities acknowledged his company billed Medicare $69 million for coronavirus and pointless allergy exams.
Schena did now no longer at as soon as return a message looking for observation.
Schena, 57, touted that the company essentially based in Sunnyvale had the finest laboratory in the arena that equipped “modern microarray know-how” that allowed it to test for allergy signs and the coronavirus with the identical finger-stick test kit, prosecutors acknowledged.
Starting in 2018 and through February 2020, Schena and other workers paid bribes to recruiters and docs to dash an allergy screening test for 120 allergens ranging from stinging bugs to meals allergens on each and every affected person, authorities acknowledged.
Because the coronavirus pandemic began to escalate, Schena, of Los Altos, suggested affected person recruiters and clinics to add its test for the coronavirus, prosecutors acknowledged.
He is also accused of publishing mistaken claims on social media and in company emails to merchants about Arrayit’s ability to present honest correct, hastily, legit and cheap coronavirus exams in compliance with deliver and federal regulations.
Schena suggested investigators he opinion establishing a test for the coronavirus per his allergy test would maybe be straightforward, “delight in a pastry chef” who switches from selling “strawberry pies” to selling “rhubarb and strawberry pies.”
Arrayit never disclosed that the Food and Drug Administration suggested it on April 17 that its COVID-19 test used to be now no longer at an acceptable stage of performance, federal prosecutors acknowledged.
The corporate also claimed partnerships with Fortune 500 companies, authorities agencies and public institutions, without disclosing they had been both trivial or did now no longer exist, federal prosecutors acknowledged.
Arrayit’s inventory label bigger than doubled by mid-March, even because the inventory market used to be crashing, per court docket paperwork.
“The enchantment of cheap legit that you just may maybe additionally factor in picks to this day’s recurring blood exams panels has captured the creativeness of the well being care alternate, making such that you just may maybe additionally factor in picks a top arena for fraudsters,” acknowledged U.S. Attorney David L. Anderson of the Northern District of California.
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