Kentucky Rehab Founder Indicted in Tax Credit Fraud Scheme
The former CEO of Addiction Recovery Care resigned following a federal indictment alleging wire fraud and money laundering, as the provider continues to face separate Medicaid fraud investigations.
Timmy G. Robinson Jr., the founder and former chief executive of Addiction Recovery Care (ARC), was indicted by a federal grand jury in the Eastern District of Kentucky on charges of wire fraud and money laundering. The indictment alleges that Robinson devised a scheme to fraudulently sell the same IRS Employee Retention Credit to two separate companies, subsequently directing the provider to spend the proceeds on operational costs rather than repaying the purchasers. Robinson has resigned from his position at ARC, which continues to operate its more than 40 treatment facilities across the state.
According to the indictment, ARC applied for two COVID-19-related tax credits in 2023, totalling nearly $7 million. In July 2025, Robinson sold the rights to the first credit to a loan company for $2.7 million. The indictment states that Robinson subsequently sold the same credit amount to a second company, falsely representing that the funds were available and concealing the prior transaction from the new buyer. When the IRS disbursed the refunds in December, Robinson directed ARC to use the ERC funds for debt obligations and other operational costs.
ARC spokesperson Vanessa Keeton confirmed Robinson’s resignation but stated that all facilities, programs, and services remain open and fully operational. She declined to comment further on the case, citing pending litigation. Robinson faces up to 20 years in prison and a $250,000 fine for the wire fraud count, while each of the two money laundering counts carries a potential sentence of up to 10 years in prison and a $250,000 fine.
Robinson’s attorney, Kent Wicker, described the charges as stemming from a pending civil dispute with investors, specifically Angelica Capital Trust, and denied any wrongdoing. Wicker stated that Robinson did not defraud anyone and had done nothing but deliver high-quality care for over a decade. The civil dispute involves allegations that ARC illegally retained more than $8 million owed to the companies that purchased the tax credits.
The indictment arrives amid ongoing scrutiny of ARC’s business practices. The FBI has been investigating alleged Medicaid fraud at the provider since July 2024. In April, the Lexington Herald-Leader, in partnership with ProPublica, reported firsthand accounts from former employees and clients who alleged they were instructed to falsely bill Medicaid or witnessed billing for services not provided. ARC has maintained that it has never knowingly or fraudulently billed Medicaid for services.
