Former Primary Health Network CEO John Laeng of West Middlesex pled guilty in federal court to one count of conspiracy to commit wire and mail fraud and one count of conspiracy to commit money laundering. The charges arose from a years-long scheme that allegedly defrauded the nonprofit health organization of nearly $2 million between 2011 and 2019.
Prosecutors contend that Laeng and four co-defendants, including former CEO Drew Pierce and former facilities director Mark Marriott, used sham contracts, inflated bids, kickbacks, and fraudulent invoices through entities such as the purported management firm, Topcoat Plus, and related companies, to obtain illicit payments from the health network.
Under a plea agreement before U.S. District Judge J. Nicholas Ranjan, Laeng, 57, faces a potential maximum of 30 years in prison - 20 years on the fraud conspiracy charge and 10 years on the money laundering conspiracy. He will be sentenced on March 16, 2026.
He agreed to be jointly and severally liable with his co-defendants for $1,980,904.46 in restitution to Primary Health Network, reflecting losses from two central schemes, and consented to a forfeiture money judgment of $654,300.
In return, the U.S. Attorney's Office will move to dismiss the remaining counts against him after sentencing, although it retains the right to outline his role and the impact on victims to the court. His plea becomes the second in the case after the case of Christopher O'Brien, owner of Excel Construction, who previously admitted to a conspiracy to commit wire or mail fraud. O'Brien awaits a repeatedly postponed sentencing.
The indictment further names John O'Brien of Masury, alleged to have submitted inflated bids and paid kickbacks through his telecommunications company Tele-Data, along with Pierce and Marriott, all of whom maintain not guilty pleas and are scheduled for a trial. The trial is expected to last up to three weeks, following the court's denial of their motions to dismiss the charges.
Source: https://www.wfmj.com/story/53119022/former-pennsylvania-health-network-ceo-pleads-guilty-to-role-in-alleged-dollar2m-fraud
Commentary
Money laundering is the process of disguising the origin, ownership, or control of money or assets derived from criminal activity so that they appear to come from legitimate sources, typically through stages of placement, layering, and integration across accounts, entities, or jurisdictions.
Money laundering can occur when employees, vendors, or executives use the organization's accounts, contracts, billing systems, or purchasing processes to move and "clean" illicit funds, exposing the employer to criminal, regulatory, financial, and reputational risk.
Common signs of money laundering in an organization include unusual or unexplained changes in transaction patterns, such as sudden large deposits, frequent international transfers, or structured payments designed to stay below reporting thresholds.
Other indicators include customers, vendors, or partners whose business activity does not match their financial footprint; shell or opaque entities with unclear ownership or purpose; complex or unnecessary payment chains; and individuals who are evasive, secretive, or resistant when asked for documentation or clarification about transactions.
To prevent money laundering, organizations should implement a clear, written anti-money laundering and anti-fraud policies, with consistent enforcement.
Employers should apply risk-based controls such as comprehensive due diligence on customers, vendors, and third parties, verification of identities and beneficial owners, ongoing monitoring of transactions for anomalies, segregation of financial duties, periodic internal audits, and secure reporting channels that allow employees to raise concerns without fear of retaliation.
Regular, role-specific training on red flags and reporting obligations, coupled with quick and well-documented responses to suspected misconduct, helps ensure that employees recognize and report potential money laundering activity before it can harm the organization.
