Madison Man Sentenced to 30 Months in Federal Prison for Role in Medicare Kickback Conspiracy
Department of Justice, Department of Justice, U.S. Attorney's Office, Mississippi, Southern. Published June 30, 2026.
Smith, a marketer for diagnostic laboratories, solicited and received kickbacks from laboratories in exchange for referrals of specimens and orders for molecular diagnostic testing of toenails and paid kickbacks to providers to induce those referrals, resulting in over $1.4 million in claims to Medicare.
Jackson, MS to A Madison man was sentenced on June 30 th to 30 months in federal prison for conspiring to defraud the United States and to offer, pay, solicit, and receive kickbacks. According to court documents and statements made in court, Auzie Phillip Smith, Jr., 68, of Madison, Mississippi worked as a marketer for various diagnostic laboratories, acting as a middleman between the laboratories and the medical providers. Smith solicited and received kickbacks from the laboratories in exchange for referrals of biological specimens and orders for molecular diagnostic testing of toenails, and in turn, induced providers to refer biological specimens and orders for unnecessary molecular diagnostic testing of toenails in exchange for kickbacks.
In total, the diagnostic laboratories submitted over $1.4 million in claims to Medicare that were procured by the payment of illegal kickbacks and bribes, medically unnecessary, and ineligible for reimbursement, and that laboratories were reimbursed over $500,000 for these claims. Smith was also ordered to pay $544,822.68 in restitution to the Centers for Medicare and Medicaid Services. U.S.
Attorney Baxter Kruger of the Southern District of Mississippi; Acting Health Care Fraud Chief Jacob Foster; and Special Agent in Charge Robert Eikhoff of the FBI Jackson Field Office made the announcement. The Federal Bureau of Investigation investigated the case. Acting Assistant Chief Sara E.
Porter of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Kimberly T. Purdie for the Southern District of Mississippi prosecuted the case.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (“Fraud Division”). The Fraud Division is investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D.
Vance to eliminate fraud, waste, and abuse within Federal benefit programs.