Psychiatrist indicted for fraud in Paxil trials

NEW ORLEANS — Dr. Maria Carmen Palazzo was indicted by a federal grand jury on 55 counts of health care fraud and false documentation in connection with a clinical trial of Paxil in children and adolescents, U.S. Attorney Jim Letten said on Thursday.

The indictment alleges that during approximately a five-year period, Palazzo, 55, of New Orleans, defrauded Medicare in connection with services she claimed to have rendered to patients in a Psychiatric Partial Hospitalization Program at Touro Infirmary.

The indictment also charges that Palazzo defrauded Medicare by submitting fraudulent invoices to Touro for consulting and medical director services. The indictment says because of that Medicare paid Palazzo over $653,000 she was not entitled to receive.

Palazzo, who specializes in psychiatry, is also charged with offenses relating to clinical trials involving Paxil.
According to the indictment, Palazzo, as a clinical investigator for SmithKline Beecham doing business as GlaxoSmithKline, fraudulently failed to maintain and prepare records required by the FDA for evaluation the drug’s safety and effectiveness in children and adolescents.

If convicted, Palazzo faces a maximum term of 445 years, and a fine of $10.15 million, Letten’s office said.