Health care fraud costs the government and taxpayers billions of dollars. It is anything but a victimless crime. Fraud means higher insurance premiums causing some people to go without medical care. Because the federal government funds much of health care, taxes also go up when Medicare money is used to pay false claims. Earlier this week, a federal jury convicted one fraudster of submitting over $2 million in false claims to Medicare.
Prosecutors say that Tariq Mahmud was the owner of Comprehensive Rehabilitation Services Inc. (CRS), a supposed rehabilitation agency located in Dearborn, Mich. Between January 2003 and February 2007, CRS purchased falsified physical and occupational therapy files from more than 30 therapy and rehabilitation companies and used them to fraudulently bill Medicare for more than $3 million.
In addition to submitting millions in false therapy claims, Mahmud lied to Medicare about his billing. For instance, when Medicare inquired regarding a beneficiary who complained that he had not received the services for which CRS billed Medicare, lied and said his professional staff claimed the services were provided but the patient was simply unsatisfied. Prosecutors say that was a total lie; CRS had no professional staff; despite medical charts and bills to the contrary and no services were performed. Evidence at trial established that the beneficiary’s identity was stolen and used by CRS and a fraudulent file-making company to bill Medicare.
At trial, the evidence revealed that many of the physical therapists never even met the patients and that patients were sometimes given drugs or cash kickbacks for use of their names.
Even more bizarre, the evidence showed that Mahmud was an accountant by profession. Despite billing millions for therapy services, Mahmud never personally delivered therapy to any of his clinic’s patients.
Court records indicate that at trial,
“the primary evidence of Mamud’s involvement in health care fraud related to hi relationship with Campau PT. Campau PT was started by [co-defendants] Victor Jayasundera and Fatima Hassan. ByJayasundera’s admission, Campau PT never treated patients—its sole purpose was Medicare fraud. Jayasundera, a licensed physical therapist, was in charge of creating fake patient files. Along with [other co-defendants], Jayasundera would create files that included intake evaluations, treatment plans, and progress notes. Hassan was in charge of finding Medicare “patients” for Campau PT. She would recruit Medicare recipients and pay them for their signatures with prescription drugs or cash. Some patients signed undated forms that were later altered to conform to the fake files that Jayasundera and the others manufactured. Mahmud did not participate directly in the production of fake files at Campau PT. Rather, his role in the scheme was billing Medicare through Comprehensive for the services Campau PT “performed” and then remitting those payments back to Campau PT after taking a 25% cut.”
Two of the therapists that Tariq Mahmud was allegedly supervising testified that they had never met Mahmud!
On February 2nd, the jury convicted Detroit area resident Tariq Mahmud of one count of conspiracy to commit health care fraud and six counts of actual health care fraud. He faces up to 70 years in prison when sentenced later this year.
Tariq Mahmud Convicted of Medicare Fraud, Sentenced to Prison
[Update July 2012 & November 2013: U. S. District Court Judge Avern Cohn sentenced Mahmud to 84 months in prison. After his sentence is complete he must do an additional 3 years of supervised release and pay $3.3 million in restitution.
Despite being convicted by a jury, Mahmud did not go quietly into the night. He appealed his conviction on a number of grounds. In November a three judge federal appeals court panel affirmed his conviction.
If you think cases like this are rare, unfortunately you are wrong. They occur everyday across the United States. Health care fraud is so rampant that the federal government created a special health care task force called HEAT (Health Care Fraud and Prevention Action Team). Since its inception just 5 years ago, the team has charged 1160 people in just 9 districts with bilking the government out of almost $3 billion in tax dollars.
HEAT is a joint task force made up of investigators from the U.S. Department of Health and Human Services and the Department of Justice. Assistance on criminal prosecutions is often provided by the FBI. Whereas HEAT tries to stop fraud by prosecuting offenders, many more offenders are stopped by false claim cases filed by whistleblowers.
Prosecutors can’t stop and arrest every person involved in health care fraud but there are things that ordinary citizens can do. Many healthcare fraud cases are uncovered by concerned health care providers. No one likes to see fraud and waste and often the people closest to the fraud become whistleblowers. Patients, billing clerks, medical assistants and sometimes even doctors are the ones who first alert authorities to these scams.
In addition to the satisfaction that comes from doing the right thing, whistleblowers are entitled to a percentage of the money recovered by the government if their tip leads to a successful false claims action. The government offers the awards to provide incentives for people to come forward and report these crimes.
Not only is health care fraud bad for America’s economy, sometimes its down right dangerous! In a recent case, a hospital physician charged that a cardiac care group was performing unnecessary cardiac stent procedures simply to bill Medicare and private insurance companies.
If you know of health care fraud, give us a call. All inquiries are strictly confidential. The fraud recovery lawyers at Mahany Law will evaluate your case and let you know if we can help put an end to the fraud and help you collect money under the false claims act. Currently, we are prosecuting the largest false claims act case in the nation against a mortgage company – a $2.4 billion claim against Allied Home Mortgage. Large or small, we want to hear about your case.
contact attorney Brian Mahany online, by phone at (414) 704-6731 (direct) or by email at All inquiries are held in strict confidence.
Mahany Law- America’s Fraud Lawyers. Offices in Milwaukee, Detroit, Portland (Maine) & Minneapolis. Services available in most jurisdictions.