Two men were sentenced on Monday for their involvement in a substantial fraud scheme that defrauded Medicare, Medicaid, and private insurance companies out of $522 million. They employed tactics like kickbacks, fraudulent medical orders, and DNA sample collection from patients nationwide.
Reyad Salahardeen, a 57-year-old from Buford, Georgia, pleaded guilty to conspiracy to commit health care fraud and wire fraud, receiving a sentence of 12 years and seven months. Mohammad Mustafa, 28, of Duluth, Georgia, pleaded guilty to a similar charge surrounding illegal medical kickbacks and was sentenced to three years in prison, as reported by the Department of Justice.
The Justice Department stated that, disguised as a health insurance operation, these two individuals purportedly attempted to steal over $500 million from taxpayers.
According to federal prosecutors, their fraudulent scheme resulted in roughly $84 million in payouts from various health care programs, highlighting a significant drain on taxpayer-funded health care initiatives and prompting stricter enforcement measures.
The fraud scheme revolved around a network of marketers who targeted individuals, particularly those on Medicare, persuading them to undergo genetic testing under the guise of free or critical tests, often related to cancer risk. However, the tests were frequently unnecessary and ordered by healthcare providers unassociated with the patients.
This allowed the laboratories to bill government health programs for costly tests that wouldn’t typically receive approval, officials explained.
Both Salahardeen and Mustafa were also mandated to repay substantial sums, with Salahardeen ordered to repay over $84.5 million, while Mustafa is to repay more than $64.3 million. Additionally, Salahardeen was instructed to forfeit upwards of $3 million from his bank account, along with a 2019 GMC Yukon and properties in Texas and Georgia.
Notably, Mustafa was born in the U.S., while Salahardeen, originally from Palestine, obtained lawful permanent residency in 2004.
The fraudulent program ran from 2018 to August 2020, utilizing marketers to conduct telemarketing, door-to-door outreach, and health fairs to gather DNA samples and insurance details from patients.
Documents indicated that Salahardeen managed several laboratories in New Jersey, Georgia, and Texas, including Express Diagnostics and Bioconfirm Laboratories. Prosecutors mentioned that marketers were given illegal kickbacks to obtain test orders from healthcare providers not treating patients.
Moreover, authorities alleged that Salahardeen falsified request forms, medical necessity letters, and additional documentation to present the tests as legitimate.
Mustafa, who co-managed some laboratories, played a role in executing this scheme by paying illicit kickbacks and creating phony contracts and invoices that masked illegal payments as authentic marketing services.
In total, the operation is believed to have claimed around $522 million in fraudulent billing. Government health programs and private insurers disbursed approximately $84 million as a result, officials stated.
Upon learning about the charges, Salahardeen attempted to elude arrest by traveling from North Carolina to Texas and even tried to cross into Mexico using someone else’s identification before being apprehended at the border.
Federal officials noted that large-scale fraud schemes are increasingly connected, facilitated by organized networks collaborating across multiple states.
Incidents of such fraud have risen in recent years, highlighted by a case in Minnesota related to pandemic-era fraud that siphoned over $240 million intended for child nutrition programs. This case, dubbed “Feeding Our Future,” resulted in numerous charges and prison sentences stretching up to 28 years.
Prosecutors claimed that, similar to the genetic testing scheme, the case involved nonprofit organizations, fake meal counts, and falsified records.
This case falls under an ongoing federal crackdown on health care fraud. Eleven additional co-conspirators, including marketers, nurses, and doctors, have already received sentences ranging from probation to almost four years in prison.
Justice Department representatives mentioned that this case exemplifies growing efforts to combat fraud under initiatives established by the Trump administration, particularly through the Task Force to Combat Fraud, chaired by Vice President J.D. Vance.
Since 2007, the Department of Justice’s Health Care Fraud Control Program has brought charges against over 6,200 individuals linked to more than $45 billion in fraudulent claims.
Information regarding attorneys for Salahardeen and Mustafa is presently unavailable.
