A judge has revoked the pretrial release of a Sebastian County lab owner indicted in an alleged scheme to defraud the federal government of more than $100 million.
Billy Joe Taylor of Lavaca was ordered to be detained Monday after the judge found probable cause that he'd committed a crime while free on bond. U.S. Magistrate Judge Mark E. Ford also found that Taylor had violated travel restrictions and improperly contacted potential witnesses in the case.
A judicial officer reported that while Taylor was free on bond, he sold hundreds of thousands of dollars worth of lab equipment to GenTech Scientific of Buffalo, New York, but only shipped the company three of the six machines it purchased. The machines he shipped did not include the software needed to run them, which made them inoperable.
More: Read the judge's order here.
Taylor's attorney argued that the missing equipment was locked up in a lab in California because of late rent payments at the facility. But a review of communications between Taylor and GenTech found that Taylor did not advise the company of any such problems, and that Taylor's messages "seemed designed to put GenTech off and lull them into inaction," the judge's order says.
No charges were filed in connection with the transaction but the court found probable cause for fraud and theft.
Taylor violated court-ordered travel restrictions by staying overnight at the River Spirit Casino Resort in Tulsa on 23 occasions between June 15 and Oct. 23, the order says. None of the casino stays were authorized by the court.
Taylor argued that the casino trips were related to medical care. His attorney said he has heart and mental health issues, for which he receives treatment in Tulsa. But a judicial officer told the court that only four of Taylor's trips to the city had been authorized, and none were for overnight stays at a casino.
More: Read the pretrial services petition for action against Taylor here.
Taylor also violated the conditions of his release by continuing to speak with three potential witnesses in the case, the order says. He allegedly remained in communication with Clayton Love, Miranda Plum and Alissa Fisher, who worked for Taylor and have knowledge of his financial dealings. Authorities in May seized two vehicles that Taylor had purchased for Plum and Fisher.
Ford ordered U.S. marshals to take Taylor into custody, ruling that he presents an unreasonable flight risk and an ongoing danger to the community.
Taylor's labs include Vitas Laboratories LLC in Sebastian County and Beach Tox LLC of Torrance, California.
The indictment accuses Taylor of filing more than $100 million in false billings for urine drug testing, COVID-19 testing and other clinical lab services. He faces 16 counts of health care fraud and one of engaging in a monetary transaction in criminally-derived property.
Each of the counts is punishable by up to 10 years in prison.
Taylor has denied allegations of wrongdoing. He told Arkansas Business last month, "Our team welcomes the indictment. It’s an opportunity for us to now present our case.”