Judge named in relation to workers' comp scheme

A Pasadena physician will plead guilty to fraud charges in a scheme that bilked California's workers' compensation system out of millions of dollars, with prosecutors naming a sitting Orange County judge as "Co-Conspirator #1" in an indictment.

Dr. Kevin Tien Do, 59, is expected to appear in federal court in Santa Ana on Jan. 3, to plead guilty to conspiracy to commit mail fraud and filing a false tax return. The scheme netted more than $3 million in state payments between 2019 and 2023 from California's Subsequent Injuries Benefits Trust Fund (SIBTF). U.S.A. v. Do, 8:24-CR-00137, (C.D. Cal., filed Dec. 06, 2024).

According to court documents, Do explicitly identified "a sitting judge" as the true owner of Liberty Medical Group Inc., the company at the center of the fraud investigation.

While prosecutors haven't named the judge, a separate civil lawsuit identifies Orange County Superior Court Judge Israel Claustro as Liberty Medical Group's owner.

Orange County attorney Paul S. Meyer represents Claustro. Reached Thursday, Meyer said it was premature to comment on the case. Spokesperson Kostas Kalaitzidis said the Orange County Superior Court's ethical rules prevented him from discussing the matter.

Federal prosecutors allege that Do continued submitting medical reports through Liberty Medical Group even after his 2018 suspension from the workers' compensation system, using other doctors' names to conceal his involvement. Approximately $1.5 million of the fraudulent proceeds went to the company's owner and his wife, while Do personally received about $306,000.

The investigation gained additional attention after psychologist Nhung Phan sued Liberty Medical Group in October, seeking approximately $100,000 in unpaid bills for workers' compensation reports.

Court documents show Phan alerted the medical group about 84 unpaid reports prepared between August 2016 and January 2017. She reported receiving an initial email from Claustro stating the bills had been paid, but subsequent communications went unanswered. Nhung Phan v. Liberty Medical Group, 30-2024-01433743-CU-BC-CJC, (O.C. Super., Ct., filed Oct. 21, 2024).

This isn't Do's first brush with healthcare fraud. In 2003, he served one year in federal prison and was ordered to pay over $366,000 in restitution for defrauding Medi-Cal, leading to his suspension from California's workers' compensation system.

Do faces a maximum sentence of 23 years in federal prison, though prosecutors have agreed to recommend a lighter sentence in exchange for his cooperation. He has also admitted to failing to report approximately $66,227 in income on his 2021 tax return.