The investigation began with two disparate issues, according to people familiar with the matter who spoke with the Post. First, auditors had been reviewing allegations that Melgen was fraudulently overbilling Medicare for treating his patients. Melgen's attorney has said the doctor's billing was completely appropriate.
Then, in the fall, the FBI began looking into an anonymous tipster's allegations that Melgen had arranged prostitutes for Menendez in the Dominican Republic. Such an arrangement could constitute providing a favor or gift under the bribery statute that investigators have been reviewing, the Post said.
Lawyers for Menendez and Melgen have said the allegations involving prostitutes, which also were made by the conservative website the Daily Caller, were absurd. Menendez has said the allegations, which first surfaced during his re-election campaign last year, were part of a Republican smear campaign.