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Founder of holistic wellness business sentenced to 8 years in prison for Ponzi scheme

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Posted at 7:14 PM, Jul 26, 2021
and last updated 2021-07-26 20:14:07-04

NASHVILLE, Tenn. (WTVF) — The founder of a Nashville-based holistic wellness business has been sentenced to eight years in prison and ordered to pay $693,128.66 in restitution for what has been deemed a Ponzi scheme by the U.S. Justice Department.

Howard L. Young, 75, duped more than 80 patients, financial institutions and investors out of nearly $700,000 after he claimed he cured himself of cancer using naturopathic methods. He's accused of soliciting cancer patients and others with chronic medical conditions to participate in a study he claimed to have funded through a $2 million grant from Vanderbilt University.

In October, he was charged by the U.S. Justice Department on four counts of bank fraud, six counts of wire fraud and aggravated identity theft. He pleaded guilty in December.

Young does not hold a medical doctorate and did not have a medical license, nor did Vanderbilt University award him or his company any grants, the justice department said.

Participants were promised to receive nutritional supplements, blood testing, nutrition and exercise coaching, a gym membership, massages and acupuncture. However, patients did not routinely receive these services, according to the justice department.

In order to participate in the study, Young told patients they must pay Vanderbilt an up-front fee of $10,000, adding that the money would be returned to them at the end of one year. Those who could not afford it were required to secure a CareCredit card or open a Health Credit Savings account.

Young allegedly told patients he would hold the funds in escrow and would make all monthly payments to the account and pay off all existing balances and the end of one year, so long as the patient abided by all study protocols.

An investigation by the FBI found that IMS generated very little revenue. The majority of the funds he deposited were from CareCredit accounts and HCS loan accounts.

The justice department said by July 2019, Young had received about $669,470 in total from CareCredit and HCS.

Young allegedly changed the mailing addresses for patients’ accounts at CareCredit and HCS so that the monthly statements went to a post office box he controlled. He’s accused of withdrawing a portion of the funds for his own personal use, as well as, making payments to his personal credit cards and minimum payments on account holders’ credit cards and loan accounts.