Former Outcome Health execs slapped with federal fraud charges

Former Outcome Health executives have been accused by federal prosecutors of defrauding pharmaceutical companies and investors in an indictment unsealed Nov. 25, according to The Wall Street Journal.

Former CEO Rishi Shah, previous president Shradha Agarwal and ex-finance chief Brad Purdy have been charged with multiple counts of mail and wire fraud and one count of bank fraud. The two-year investigation by the Department of Justice was sparked by a 2017 Wall Street Journal report that claimed the startup had misled customers by using false data.

Mr. Shah has also been charged with two counts of money laundering. Mr. Purdy is also facing one count of making a false statement to a bank, reports WSJ.

The Securities and Exchange Commission also brought charges Nov. 25 against the former executives, claiming the three committed civil securities fraud. The SEC is demanding Mr. Shah and Ms. Agarwal pay back any money raised illegally through investors.

William Burck, a lawyer for Mr. Shah, said the ex-chief executive denies the charges and "looks forward to his day in court and the opportunity to clear his name," according to the Chicago Tribune.

An attorney for Ms. Agarwal also said her client denies the allegations.

"Shradha never committed fraud and never participated in any conspiracy. To the contrary, Shradha was committed to transparency and integrity at Outcome Health. She will fight to protect her good name in court," said Christina Egan, Agarwal's lawyer, the managing partner at law firm McGuire Woods's Chicago office, according the Chicago Tribune.

Disclosure: Becker's Healthcare Publisher Scott Becker is a partner with McGuireWoods.

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