ST. PETERSBURG — The founder of St. Petersburg's Universal Health Care alleges that Florida regulators conspired with the company's chief financial officer to drive the once high-flying Medicare insurer out of business.In a response this month to a lawsuit against him, Dr. Akshay Desai says regulators pressured CFO Alec Mahmood into cooperating with them or face being blackballed from the insurance industry. The response says Mahmood "secretly and criminally" recorded at least 11 conversations with Desai and other Universal executives as regulators moved to put the company into receivership. Universal filed for bankruptcy in February 2013 and shut down a month later after FBI agents raided its headquarters. The company's collapse left more than 800 employees without jobs, scores of providers unpaid and thousands of members searching for alternative Medicare Advantage plans to cover their health care needs.PREVIOUS COVERAGE: Akshay Desai and the rise and fall of Universal Health Care "We ultimately came to the conclusion that the state of Florida acted somewhat nefariously in orchestrating the receivership and they were doing a deal with someone (Mahmood) who was committing a crime," said attorney Daniel Nicholas, who represents Desai. In allegedly recording Desai and others without their permission, which would violate state law, Mahmood "was possibly hoping they would incriminate themselves, but they never did," Nicholas said.A judge in Tallahassee could rule Friday on a motion that could eventually require Desai to relinquish $2.5 million in compensation he received while at Universal's helm. But in his response, Desai says he was entitled to the money because Universal was solvent, contrary to what Mahmood had led regulators to believe. Mahmood could not be reached for comment. Calling Desai's allegations "entirely baseless," Florida's Department of Financial Services said in a statement Wednesday that it gave Mahmood "absolutely no assurances" about his future employment. "As this matter relates to ongoing and active litigation, no further comments will be provided,"' the statement said.Started by Desai in 2006, Universal enjoyed dizzying growth due its Any, Any Any plan — in which members purportedly could see any doctor anywhere at any time — but it also drew complaints of poor customer service. In 2008, the company agreed to beef up reserves to handle the swelling volume of claims. Over the next few years, Universal expanded to 23 states and served 140,000 members. It spent more than $10.5 million to buy and renovate a striking headquarters in downtown St. Petersburg, and paid $500,000 for a posh condo nearby. The first sign that Universal might be in serious financial trouble came in late 2012 when it agreed to stop selling Medicare policies in Georgia after losing $22.1 million in the first six months of the year. In early 2013, the Florida Office of Insurance Regulation deemed Universal nearly insolvent and accused executives of a broad pattern of financial mismanagement — including fraud and diversion of funds — under Desai's leadership.In his response to demands he pay back $2.5 million, Desai denies the company was in desperate straits. But, he says, Mahmood colluded with regulators to "facilitate" Universal's demise. Shortly after Mahmood became CFO, Desai alleges, regulators said that if he cooperated, they would not enforce a state statute that bars officers of a failed insurance company from subsequent employment in the insurance field. Attached to Desai's response as evidence is a January 2013 email from Toma Wilkerson, then a top official in the Florida Office of Insurance Regulation. "After my conversation with Alec (Mahmood), I discussed with legal his concern about not being able to work in the industry," Wilkerson wrote to several colleagues. "(I) was advised that we would likely not use that statute for him since the company was failing long before he arrived and he had been cooperating with us."According to Desai, Mahmood "falsely and maliciously" told regulators that Desai had instructed him to inflate the amount of Medicare reimbursements that Universal expected to receive from the federal government in order to make it appear the company was financially sound.In reality, Desai says, Universal underestimated the amount of Medicare reimbursements the government eventually would pay: $60 million for 2012. That shows Universal was in fact solvent at the very time regulators were preparing to shut it down, the response says. As result, the $2.5 million Desai received in compensation "was more than equivalent value for the service he provided to Universal that exponentially increased profitably, membership and (the) overall business of Universal," he says.The lawsuit against Desai and the attempt to "claw back" the $2.5 million grew out of Universal's bankruptcy case, which has dragged on for more than four years. Desai and other executives hired criminal defense attorneys early on, but no criminal charges have been filed PREVIOUS COVERAGE: Universal Health Care trustee trying to recoup payouts A major Republican donor in Universal's heyday, the 59-year-old Desai resumed his internal medicine practice after the company's collapse and has largely faded from public view. The state seized and sold both the condo and Universal's headquarters — the latter is being converted into the James Museum of Western & Wildlife Art. Contact Susan Taylor Martin at [email protected] or (727) 893-8642. Follow @susanskate.