Salesman Admits Role in $100 Million Blood Lab Bribery Scheme


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The circle of people involved in a $100 million bribery scheme keeps growing — most recently with a salesman’s admission of funneling $400,000 in kickbacks to a doctor. The scheme was run through Biodiagnostic Laboratory Services, a blood lab in Parsippany, NJ.

According to ParsippanyFocus.com, Michael Zarrelli, 48, plead guilty this week for his role in the scheme, which brings the total number of players in it to 37. Twenty-four of them are doctors.

Zarrelli is a Berkeley Heights based salesman. Prosecutors say that he admitted to conspiring with the President of Biodiagnostic Laboratory Services David Nicoll to bribe a doctor with cash to refer blood samples from patients to the lab.

Zarrelli’s position as a salesman put him in a uniquely lucrative position in the scheme. From 2011 to 2013, he was paid a commission by the lab to recruit physicians that would refer blood samples from their patients to the lab. The lab would then bill Medicare and other insurers for the tests.

It’s essential that any hiring manager look closely at candidates to ensure that they won’t engage in unethical behavior — turnover of a sales team is already high (40% per year) — and a hiring mistake could cost up to 10 times a person’s salary.

Zarrelli was paid directly by the lab to participate in the scheme. A career in sales is also generally a tough gig — of all of the sales people in North America, 40% miss their quotas, 22% cannot be trained, and only about 10% will provide a return on investment.

For Zarrelli, his unethical behavior and involvement in the bribery scheme is going to cost him $750,000 and 25 years in prison.


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