KBWB Operations LLC, which operated under the name Atrium Health and Senior Living (KBWB-Atrium), and its former CEO, Kevin Breslin, have pleaded guilty to charges of health care fraud and tax conspiracy. The guilty pleas, announced by the U.S. Department of Justice, stem from a scheme that diverted millions of dollars in federal Medicare and Medicaid funds intended for the care of vulnerable nursing home residents, using the money for personal expenses and owner payouts instead.
Breslin, 58, of Hoboken, New Jersey, pleaded guilty on December 17, 2024, while KBWB-Atrium entered its plea on January 21, 2025. The company, which operated 23 skilled nursing facilities in Wisconsin, Michigan, and New Jersey, is accused of prioritizing payments to its owners over meeting federal regulations designed to ensure the safety and well-being of residents. The case highlights a disturbing pattern of corporate greed at the expense of some of the nation’s most vulnerable citizens.
According to court documents, from January 2015 to September 2018, Breslin and KBWB-Atrium orchestrated a scheme that diverted funds meant for the operation, management, and care of nursing home residents. Instead of using the money to maintain facilities and provide quality care, the defendants allegedly funneled funds to pay owners’ distributions and guaranteed payments, even when the company was struggling financially. This left the facilities understaffed, under-resourced, and unable to meet federal standards for resident care.
The scheme also involved failing to pay vendors for services rendered, some of whom went unpaid for extended periods or not at all. Additionally, the company withheld insurance premiums and 401(k) contributions from employees’ paychecks without remitting those funds to the appropriate administrators, leaving employees financially vulnerable.
Tax Conspiracy Adds to the Charges
In a separate but related conspiracy, Breslin directed KBWB-Atrium to withhold income and employment taxes from employees’ paychecks without remitting the funds to the IRS. This caused employees to file tax returns under the false assumption that their withholdings had been paid to the government, further compounding the financial harm inflicted by the defendants.
“Americans rely on skilled nursing facilities to care for themselves, family members, and other loved ones, and the operators of these institutions must live up to their obligations and the law,” said Acting Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “The Department of Justice will continue to work closely with its law enforcement partners to help ensure the safety and dignity of our most vulnerable citizens.”
U.S. Attorney Timothy M. O’Shea for the Western District of Wisconsin echoed this sentiment, stating, “Healthcare fraud affects every American. My office was proud to partner with the Justice Department’s Civil Division to help prosecute these individuals who harmed seniors and exploited our health care benefits programs for personal gain.”
Law Enforcement’s Unwavering Commitment
The case was investigated by a coalition of federal and state agencies, including the IRS Criminal Investigation Division, the Department of Health and Human Services Office of Inspector General (HHS-OIG), the FBI, and the Wisconsin Department of Justice. Their collaborative efforts uncovered the extent of the fraud and brought the defendants to justice.
“This guilty plea demonstrates our unwavering commitment to holding individuals accountable who exploit vulnerable populations and defraud the healthcare system for personal gain,” said FBI Assistant Director Chad Yarbrough. “Breslin’s actions not only eroded public trust but endangered the well-being of patients who rely on our health care system.”
Breslin and KBWB-Atrium are scheduled to be sentenced on May 7, 2025, by U.S. District Judge William M. Conley in the Western District of Wisconsin. Breslin faces up to 10 years in prison for health care fraud and five years for tax conspiracy, along with potential restitution and monetary penalties. The court will determine the final sentences after considering federal sentencing guidelines and other statutory factors.
“The guilty pleas of Kevin Breslin and KBWB Operations LLC serve as a reminder that healthcare fraud is not only a direct violation of patient care but also an attack on the financial systems that underpin public and private trust,” said Acting Special Agent in Charge Ramsey E. Covington of IRS Criminal Investigation. “IRS-CI and its law enforcement partners remain dedicated to investigating and prosecuting individuals and businesses who seek to exploit public and private institutions for personal gain.”
