A New Jersey pharmacy has sued a Springfield payment processing firm and its owner, claiming that she either stole more than $5 million or bought into a phishing
scheme that resulted in a seven-figure loss.
While her attorney disputes both the theft accusation and the size of the loss alleged by Empire Specialty Pharmacy, Debbie Drennan, owner of E-MedRx Solutions on Durkin Drive, called Springfield police in April and reported that payments due several pharmacies had gone to people or entities that had pretended to be pharmacies that had contracts with her company. She told police that her company had fulfilled emailed requests to direct funds to accounts with no connection to pharmacies. In one case, Drennan told police, more than $424,000 went to a Go Bank account after she received an email, she later realized was phony, requesting a change in accounts.
An
attorney for Drennan and E-MedRx Solutions says that his client
is no thief, and he disputed the allegation of a multi-million dollar loss,
calling Empire Specialty Pharmacy’s claim of a $5 million theft “a
pie-in-the-sky number that has no factual basis whatsoever.”
“E-MedRx
and its president, Debbie Drennan, look forward to vindicating themselves in
court,” Patrick Moran, attorney for Drennan and her company, wrote in an email.
Eduard
Shtindler, Empire owner, declined an interview request, directing questions to
his attorney, who did not return a phone call.
Empire
hired E-MedRx last November to process billings and collect payments that were
supposed to be forwarded to the New Jersey-based pharmacy. Such arrangements
are common for independent pharmacies, which retain so-called pharmacy services
administration organizations to handle billing and negotiate favorable financial
deals with pharmacy benefit managers, which process claims and payments for insurance
companies.
The
relationship between Empire and E-MedRx went smoothly, with money flowing to
the pharmacy’s bank account in New Jersey until April, when payments to the
pharmacy from the Springfield firm suddenly stopped, according to the lawsuit. When
Empire asked about its money, E-MedRx responded that funds were being deposited
in a different bank account than the pharmacy had designated when it had signed
up with Drennan’s company a few months earlier. When Empire said it didn’t
recognize the account, E-MedRx sent the company an email from a phony email
address requesting that the pharmacy’s money be sent to the bank account that
Empire had never heard of.
“The
email address of the email presented by E-MedRx was patently invalid,” Empire
says in its lawsuit. “Additionally, the text of the email contains obvious
grammatical and spelling errors, i.e. ‘I will let you know once the funds have
arrived our chase bank account.’” The routing number of the bank account not
controlled by Empire is the one used by J.P. Morgan Chase Bank for accounts in
Illinois, according to the lawsuit.
In
the lawsuit, Empire accuses Drennan and her company of stealing the pharmacy’s
money, then trying to cover up the theft by creating the email that instructed E-MedRx
to start sending funds to the bank account that had no connection to Empire.
The pharmacy, however, also allows in its lawsuit that it’s possible that Drennan
and her company fell for a phishing scheme.
Moran,
the attorney for Drennan and her company, says that his client has committed no
crime.
“Upon
learning of the theft, E-MedRx promptly alerted law enforcement authorities and
the FBI is now investigating,” Moran wrote in an email. “E-MedRx has since
fully cooperated with the FBI to help identify and catch the perpetrator of
this crime. To add insult to injury, and without having any factual basis to do
so, Empire decided to file a false and malicious lawsuit against E-MedRx,
accusing E-MedRx of masterminding the scam and pocketing the money.”
While
calling the claim of a $5 million loss untrue, Moran declined to say how much
money might be missing.
Empire
also accuses Drennan of lying, saying that she falsely told the pharmacy that
E-MedRx owed no money to Empire because no monies due the pharmacy were
received since the last funds were deposited into the correct account. Empire also alleges that Drennan told the pharmacy that she had submitted a claim to her insurer to cover the loss, but no claim was filed and neither Drennan nor her company were insured for such matters. The
pharmacy also says that E-MedRx has refused requests for an accounting of
funds.
In
its lawsuit, Empire says that Drennan and her company previously have been
accused of sending unauthorized payments to third parties. In a 2015 federal
lawsuit, All About Your Health, a company that had both a pharmacy and a
medical clinic in South Carolina, sued Drennan and her company, alleging that
E-MedRx had sent money from insurance companies to a drug distribution firm
after All About Your Health had terminated its contract with the firm and told
Drennan’s company to stop sending money to the firm.
According
to the 2015 lawsuit, Drennan had recently formed E-MedRx and transferred
accounts to her new company from a company she had previously owned,
misrepresenting herself to insurance companies as chief executive officer of
All About Your Health and signing documents on behalf of All About Your Health.
The lawsuit ended with a consent order and injunction requiring Drennan’s
company to give a full accounting of disbursements to All About Your Health,
cease giving All About Your Health’s money to any entity except All About Your
Health and immediately transfer any funds due All About Your Health to All About
Your Health. The injunction also barred Drennan and anyone else in her company
from representing themselves as being affiliated with All About Your Health.
According
to findings of fact contained in the consent order, E-MedRx, in the space of a
month, sent nearly $1.3 million of receivables from insurance companies to the
drug distribution firm that All About Your Health, several times, said should
not be paid. The payments were made by E-MedRx after All About Your Health had
told the Springfield company not to pay the drug distribution firm.
Moran,
the attorney for E-MedRx and Drennan, said in an email that the 2015 lawsuit
was the result of a “misunderstanding” and was resolved with the consent order.
“The
2015 case has no connection whatsoever to the cybertheft of E-MedRx or Empire’s
lawsuit,” Moran wrote. “As with most of the allegations in Empire’s lawsuit,
the existence of this 2015 lawsuit has been mischaracterized.”
Contact Bruce Rushton at brushton@illinoistimes.com.
This article appears in Jun 21-27, 2018.
