Scooter Store, Backed By Sun, Raided By Cops

  • 150 investigators swarm HQ
  • Medicare billing is in question
  • Firm took stake in 2011

The Scooter Store, which is backed by Sun Capital Partners, has been raided as part of an ongoing investigation, according to sister Web site peHUB, which cited a number of media reports. CBS reported that more than 150 investigators swarmed the company’s Texas headquarters as part of a Medicare fraud inquiry.

A representative for Sun Capital did not respond by deadline to a request for comment.

The bevy of badges included the Office of the Inspector General, the Department of Justice, the FBI and the Texas attorney general’s Medicaid fraud division, the Associated Press reported. Some employees, including sales and IT, were kept away from their work, CBS reported.

Among the allegations made by government auditors are that the Scooter Store overbilled Medicare by more than $100 million from 2009 to 2012. The Scooter Store provides senior mobility products, and advertises that social programs like Medicare will help many of its customers in purchasing their scooters.

In the time since Sun Capital has backed the Scooter Store, the company has undergone substantial changes. In 2012, founder Doug Harrison stepped away from the business. He was replaced by ex-Kinetic Concepts Inc. executive Martin “Marty” Landon. An Associated Press report stated that the company has laid off hundreds of employees since late last year.

PeHUB reported in 2011 that Sun Capital Partners backed the Scooter Store in a minority deal that was a recap transaction. Sources didn’t provide specifics on how much the firm invested. The Boca Raton, Fla., buyout shop is known as a turnaround specialist.

In 2010, the Scooter Store was named by Fortune magazine as one of the 100 best places to work.

Jonathan Marino is editor/columnist for peHUB.