Feds say sex acts were paid for by California dock workers’ health plan; 10 charged in insurance scheme

Federal charges were filed against 10 people, including eight who work at the Port of Long Beach, accused of scheming to file fraudulent health insurance claims for more than $2.1 million for what actually were sexual services, officials said Wednesday.

Sara Victoria, 46, of San Pedro, who prosecutors have accused of being the conspiracy’s ringleader, was charged Wednesday with one count of conspiracy to commit health care fraud and one count of aggravated identity theft. Another woman who worked with Victoria and eight  dockworkers were named in the alleged conspiracy.

From January 2017 to August 2021, Victoria owned three businesses in San Pedro and Wilmington that offered patients chiropractic services, acupuncture treatments and also sexual services, according to a plea agreement signed by Victoria.

Victoria recruited women from Long Beach strip clubs to provide sexual services to dockworkers, who were insured through the International Longshore and Warehouse Union – Pacific Maritime Association (ILWU-PMA) benefit plan, according to court documents.

The health plan generally covered chiropractic services and physical therapy with no deductible or out-of-pocket expenses, a news release from the U.S. Justice Department said.

In exchange for the sexual services, clients would allow Victoria to submit false reimbursement claims for chiropractic services and physical therapy that were never provided under their names, or to submit names of family members including spouses and children who did not receive services, prosecutors said. This allowed clients to continue receiving sexual services even after using all their allotted visits covered by their insurance for chiropractic services.

Clients would also receive cash kickbacks, prosecutors said.

Approximately $2,110,920 in claims were submitted by Victoria to the ILWU-PMA plan, of which the plan paid approximately $551,810.

Victoria signed a plea agreement. After entering a formal guilty plea, Victoria could face a statutory maximum sentence of 12 years in federal prison.

Eight other defendants signed plea agreements on conspiracy to commit health care fraud charges.

One dockworker charged with one count of conspiracy to commit health care fraud, two counts of health care fraud and one count of making false statements to federal investigators pleaded not guilty. He was released on a $20,000 bail and a trial is set for November.

The FBI and the U.S. Labor Department investigated this case.