By WMBD TV

BLOOMINGTON – The fall from grace continues, it appears, for a former biotech wunderkind who was indicted by a federal grand jury for having illegal items within the Peoria County Jail.

The allegations against Aaron Rossi, 41, say he had a cannabis vape pen while an inmate at the jail earlier this month. The contraband charges could expose him to up to 10 years in prison if he’s convicted.

The incident occurred on March 14 and five days later, Rossi, the former head of Reditus Labs which was one of the state’s COVID-19 testing companies, appeared before a federal judge Wednesday clad in the orange inmate jumpsuit.

It’s a far cry from the tailor-made suits and the expensive cars he was associated with while the pandemic raged.

Last summer, he was sentenced to five years in federal prison for defrauding his former employers, Central Illinois Orthopedic Surgery in Bloomington, out of more than $1 million.New federal indictment alleges Aaron Rossi committed fraud in COVID-19 Testing

And he’s also still facing other federal charges of healthcare fraud, mail fraud, and wire fraud for allegedly defrauding the state of Illinois and public and private health insurance companies out of hundreds of thousands of dollars during the COVID-19 pandemic. 

Peoria County Sheriff Chris Watkins said Rossi has been at the county jail since Aug. 23, 2023. While it was not immediately clear why he has been there since last summer, one reason could be that he still has pending cases here.

U.S. District Judge Sara Darrow set a mid-May trial date for Rossi. until then, he remains in custody of the U.S. marshals.

Reditus Labs

Pekin-based Redtius, a pathology lab, seized upon the COVID-19 pandemic to become one of the state’s largest testing companies, earning more than $200 million before it was shuttered in 2022 due to lawsuits from former business partners.

But that started to unravel when his former partners alleged they were cut out or pushed out of the company and thus, the profits. The suits alleged Rossi used the company as his own personal piggy bank to finance his lifestyle which included a private jet, fancy cars and other luxury items.

The company shuttered in late 2022, sending hundreds of people to the unemployment line.

Federal prosecutors have alleged in the other fraud case that Rossi, through Reditus, overcharged or mischaracterized tests such as PCR testing that could check for infectious diseases, including the COVID-19 virus as a way to get more money from the government.

The tests were both paid with public and private health insurance programs, such as Medicare, Medicaid, Blue Cross Blue Shield of Illinois, Healthlink, and the Health Resources & Services Administration’s Uninsured Program.

The Bloomington case

Regarding the case he was sentenced to prison on, those charges alleged he moved the practice’s bank account to a different institution and changed accountants. He also made misleading and false entries in the firm’s financial records to hide this.

The indictments list the practice as a victim as well as two doctors who owned the practice, listed in the indictment as “Victims A and B.”  

The fraud involved having items such as a 49-inch high-definition TV shipped to his house on the company’s dime as well as hiding his trips to upscale men’s clothing stores as “uniform purchases.”

A federal prosecutor said Rossi chartered a private plane for his bachelor’s party using corporate money and also got other items from Amazon as well.

The filing a false tax return count occurred on Rossi’s 2017 tax return, where he told the judge that he failed to give his accountant all his information so he could avoid paying taxes. A prosecutor said that amounted to about $500,000 of unreported income.

The civil suits

Several lawsuits have been filed in both federal and state court against Reditus, Rossi and others.

Two federal lawsuits, unsealed last year, allege massive fraud and grift committed by Rossi and his company, Reditus Laboratories, which resulted in taxpayers being bilked out of hundreds of millions of dollars.

The status of those pending lawsuits was not immediately available.

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