Former eHealth CEO pleads guilty on fraud charges

Crime

One Hundred Dollar Banknotes. (Getty)

HENRIETTA, N.Y. (WROC) — The former CEO of the West Henrietta-based eHealth Global Technologies pleaded guilty Thursday on charges of wire fraud and filing a false tax return.

According to prosecutors, Michael Margiotta, 48, used his position as eHealth CEO to enter into a contract with his wife’s recruiting company, Healthcare Network Alliance, LLC. Under the agreement, HCNA would be paid if eHealth hired the companies HCNA referred.

Prosecutors say Margiotta “caused” HCNA to invoice eHealth for services he knew HCNA did not provide. Fraudulent invoices were submitted for a total of 23 employees, equaling $380,960 in payments to HCNA.

Margiotta then filed a false tax return for 2013, claiming a taxable income of $260,334 when in reality his income was $611,195.

Margiotta faces a maximum penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for October 28.

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