BREAKING: Chatman drug treatment associates owe millions

Updated June 30, 2017
Stephanie Crissey holds a photo of her late niece Jaime Holley, after Kenny Chatman’s sentencing outside the federal courthouse in West Palm Beach on May 17, 2017. (Richard Graulich / The Palm Beach Post)

Conspirators in Kenny Chatman’s sprawling drug treatment criminal enterprise are on the hook for millions of dollars, with one man expected to pay his share of $5.6 million in restitution.

Chatman’s operations had a horrifying human cost but most of the money came from insurers. Family members blame his operations for loved ones’ deadly relapses, and prosecutors told how Chatman screwed shut a home’s windows to keep women from escaping forced prostitution.

Friday’s court filings show how prosecutors are now seeking an accounting.

In three filings, lawyers for Chatman’s co-defendants agreed with prosecutors that they are jointly liable for millions of dollars they scammed from insurance companies. A judge agreed to the restitution amounts Friday.

Chatman, subject of an NBC profile, was not known as one of the biggest sober home operators. But his victims could tell stories like, “I first met Kenny Chatman in 2015 at age 19. Kenny Chatman kidnapped me.” The Palm Beach Post first exposed Chatman in 2015, leading Chatman to consider suing the paper.

In the case of Michael Bonds, who owned the Redemption sober homes in Delray Beach and took kickbacks from Chatman for referring patients, that tally is $5.6 million. More than $3.1 million in losses are to Blue Cross Blue Shield alone.

Cigna, which pulled out of Florida’s federal health insurance marketplace because of “an exponential increase in fraudulent and abusive” drug treatment practices, was hit for more than $780,000, a filing says. United Health Care lost more than $614,000; ValueOptions, almost $150,000; and Humana, more than $117,000.

Bonds, sentenced to 4¾ years for his role in the enterprise, signed a statement acknowledging the level of fraud. Stefan Gatt, a body builder who got an 18-month prison sentence because he took kickbacks for unnecessary urine tests, is on the hook for a share of nearly $3.7 million in restitution.

Barry Gregory, a onetime licensed mental health counselor who was Chatman’s clinical director, was prosecuted in a separate federal case and is to pay a share of nearly $3.2 million. Blue Cross Blue Shield accounted for $1.8 million of those costs. Gregory admitted he knew 90 percent of his patients might still be on drugs. He was given a five-year sentence.

Chatman, who ran the Reflections Treatment Center in Margate, was sentenced to 27½ years in prison. He and his wife, Laura, have not reached agreement on restitution. They face an Aug. 2 hearing on the matter.

Named in the restitution filings are Gregory, Kenny and Laura Chatman, Bonds, Joaquin Mendez, Dr. Donald Willems and Fransesia Davis.

Half of any wages earned in federal prison jobs must go to the restitution. After release, the defendants will have to pay restitution at the rate of 10 percent of monthly gross earnings.

Davis’ restitution hearing has been rescheduled for Aug. 3. Willems is seeking to have his Aug. 30 restitution hearing moved to Miami. The prosecution of Mendez continues.