The doctor is accused of engaging in "sophisticated fraud and money laundering schemes."
Dr. Manoj Patharkar, 45, of South Amboy. TRENTON -- A New Jersey doctor on Monday admitted to hiding more than $3.6 million in income to avoid paying taxes and using the money to bribe other medical professionals for illegal referrals, authorities said.
Manoj Patharkar, 45, engaged in "sophisticated fraud and money laundering schemes" in which he made up phony payroll expenses and hid money from his pain management business in private accounts, according to the state Division of Criminal Justice.
He pleaded guilty Monday to first-degree conspiracy, first-degree money laundering, seven counts of third-degree filing fraudulent tax returns and three counts of third-degree failure to pay taxes.
Patharkar, of South Amboy, evaded roughly $327,000 in state taxes through the scheme, authorities said. He also admitted paying as much as $1.5 million in kickbacks to 13 doctors who referred patients directly to his pain clinics in violation of state law, according to the state Office of the Insurance Fraud Prosecutor.
Under a plea agreement, the state will recommend Patharkar serve up to 10 years in state prison, including five years of parole ineligibility, and pay half a million dollars in penalties. His company, Pain Management Associates of Central Jersey, would also have to be dissolved.
Sentencing is scheduled for January.
Four others have previously pleaded guilty for their roles in the scheme. A 52-year-old Sayreville man, Mohammed Shamshair, pleaded guilty in February to conspiracy and money laundering charges for acting as a Middleman between Patharkar and the doctors.
Man admits role in kickback scheme
A New York accountant, Irfan Raza, pleaded guilty to conspiracy charges for helping the pair launder the money, authorities said.
Two chiropractors -- Alexander Dimeo and Ronald Hayek -- pleaded guilty this summer to conspiracy, money laundering and commercial bribery charges for accepting tens of thousands of dollars in illegal bribes from Patharkar's firm.
"We're coming down hard on this type of corruption in the industry, which causes patients to receive unnecessary services and raises costs for all healthcare consumers," Elie Honig, the director of the Division of Criminal Justice, said in a statement, adding that anyone who is aware of such fraud can report it to state authorities anonymously.
S.P. Sullivan may be reached at ssullivan@njadvancemedia.com. Follow him on Twitter. Find NJ.com on Facebook.