Australasian Dental Practice

Monday, 22 July, 2024

01 Feb 2003 | Australasian Dental Practice

news > Spectrum > Page 14

Dental labs, dentists defraud German government

A substantial fraud against the German Health System by a dental laboratory and its dentist customers has been uncovered involving millions of Euros in exaggerated claims.

The managing director and three staff of the commercial dental laboratory Globudent in Muelheim have been charged with instigating and inciting fraudulent transactions within the German Health System.

It is alleged the laboratory acted as agents for the importation of cheap dental prosthetics made in Asia while charging dentists the same tariffs as locally made appliances. Patients or the local health system were then charged the higher tariff and the collaborating dentist received a portion of the profits paid discreetly and mostly in cash.

In one case, an invoice for a prosthesis indicating it had been made in Germany was charged at 900 Euro while a corresponding invoice discovered during searches of the lab and dentists' premises revealed an invoice from China for only 120 Euro. It is alleged that up to one third of the profitable difference in costs flowed back to the participating dentists.

The major local medical benefit organization of Lower Saxony, Allgemeine Ortskrankenkasse (AOK Fund), estimates that the total fraudulent sum could exceed 100 million Euro. It is estimated that the laboratory had up to 2000 dentist clients across Germany and employed some 50 dental technicians, the majority of whom worked on the legitimate side of the business producing prosthetic/restorative work at the correct German tariff prices.

According to testimony from the AOK Fund, Globudent, however, actively encouraged dentists to use cheaper dental prosthetic work originating from China and the fraud was discovered after dentists that became aware of the scheme but did not participate in it reported it.

The Fund believes that there are other dental laboratory businesses involved in similar fraudulent transactions.

The dentists involved are being sued for damages emanating from the fraudulent transactions and were likely to have their registrations cancelled by the dental board as well as being investigated for tax evasion as many of the kickbacks were paid in cash and in some cases, this money was paid offshore.

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