An Illinois man and a foreign national were arrested yesterday on criminal charges related to their alleged submission of more than $227 million in fraudulent claims to Medicare.
According to court documents, Syed Murtuza Kablazada, 34, of Arlington Heights, and Syed Mehdi Hussain, 32, of Carol Stream, owned and operated purported medical laboratories that submitted fraudulent claims to Medicare for the reimbursement of over-the-counter COVID-19 test kits allegedly provided to Medicare beneficiaries. The defendants allegedly installed foreign nationals to act as nominee owners at the laboratories to submit fraudulent claims to Medicare for the provision of over-the-counter COVID-19 test kits, with the understanding the nominee owners would flee the United States when they learned that their laboratory was under investigation.
“As alleged, the defendants used straw owners at multiple laboratories to cause the submission of more than $200 million in fraudulent claims to Medicare for COVID-19 test kits,” said Matthew R. Galeotti, Head of the Justice Department’s Criminal Division. “Health care fraud harms Americans by squandering taxpayer money and diverting limited resources from those who need them most. The Criminal Division will continue to aggressively prosecute these crimes to hold fraudsters accountable, protect victims, and recover financial losses.”
“The overwhelming fraud uncovered in this investigation details a blatant disregard for America’s critical health care program, Medicare, and puts all patients at risk,” said Special Agent in Charge Douglas S. DePodesta of the FBI Chicago Field Office. “The FBI and our partners will not tolerate anyone who abuses the health care system for personal gain and will aggressively pursue justice on behalf of both patients and taxpayers.”
“The submission of fraudulent claims to Medicare for products or services not dispensed or not medically necessary undermines the integrity of this valuable program, intended to protect the most vulnerable in our community,” said Deputy Inspector General for Investigations Christian J. Schrank of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Today’s arrests demonstrate our unwavering commitment, working in conjunction with our law enforcement partners, to identify, investigate and bring to justice those who seek to defraud our nation’s federal healthcare programs.”
As alleged in the indictment, the defendants rarely provided Covid-19 test kits to Medicare beneficiaries but instead submitted reimbursement claims on behalf of beneficiaries who had not requested COVID-19 test kits, including individuals who were deceased. Further, the defendants allegedly paid a marketing company to provide the names of hundreds of thousands of Medicare beneficiaries that the defendants used to submit fraudulent claims. In total, between September 2022 and June 2023, the defendants’ labs billed Medicare approximately $227 million in fraudulent claims, of which Medicare paid approximately $136 million in reimbursements.
Jeffrey Newman is a whistleblower lawyer representing doctors who become whistleblowers reporting SEC violations, Medicare and Medicaid fraud. He also represents whistleblowers in IRS tax evasion cases, SEC violations and tariff fraud cases. Jeff frequently writes on events affecting world social developments including AI. He can be reached at Jeff@JeffNewmanLaw.com or at 978-880-4758
