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'Rehab mogul' faces multiple sexual assault and money laundering charges

A self-described “rehab mogul” has been charged with multiple sexual assault offenses as well as defrauding insurers in a $175-million billing scheme, prosecutors said.

Christopher Bathum, who founded 19 sober-living facilities in Southern California and Colorado, faces accusations in two separate cases of sexually assaulting nine patients and laundering money, according to the Los Angeles County district attorney’s office.

Bathum pleaded not guilty Monday afternoon in downtown Los Angeles.

Prosecutors charged the 55-year-old operator of Community Recovery of Los Angeles, also known as CRLA, with 12 counts of furnishing drugs and 34 counts of sexual assault-related offenses, including sexual exploitation, rape and rape of an intoxicated person.

In that case, prosecutors said Bathum sexually assaulted female clients and provided some with drugs. The assaults allegedly occurred between 2012 and 2016 at the treatment centers.

In a separate case, Bathum and the firm’s chief financial officer, Kirsten Wallace, have been charged with 31 counts of money laundering. They also face charges for insurance fraud, grand theft and identify theft.

According to the California Department of Insurance, Bathum and Wallace stole patients’ identities to buy health policies without their knowledge. Then they billed their former clients for treatment they were no longer receiving, prosecutors said.

Between June 2012 and December 2015, Bathum and Wallace issued $175 million in bills for services that, in most cases, were never provided, according to the district attorney’s office. As result of the scheme, prosecutors said five insurance companies paid out $44 million.

Bathum and Wallace were arrested Thursday during a raid that included searches of 15 locations in Los Angeles and Orange counties, according to the Los Angeles County Sheriff’s Department.

Detectives began investigating Bathum in May after someone filed a sexual assault complaint, said Lt. Todd Deeds of the Los Angeles County Sheriff’s Department’s Major Crime Bureau.

The investigation was launched a month before ABC’s “20/20” aired an hour-long episode on Bathum and his treatment centers, which had been the subject of an L.A. Weekly report last year detailing the allegations and dozens of lawsuits filed against him. Bathum has denied the allegations.

If Bathum and Wallace are convicted, they each face up to 53 years in state prison. In the sexual assault case, Bathum faces up to life in prison.

veronica.rocha@latimes.com

For breaking news in California, follow @VeronicaRochaLA on Twitter.

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