Two brothers from Naperville, Illinois, are facing federal charges for allegedly running a massive health care fraud scheme that exploited the COVID-19 pandemic, prosecutors say. The pair reportedly used stolen funds to buy luxury cars, gold bars, and mansions overseas.
Minhaj Feroz Muhammad, 37, and Sufyan Feroze, 35, were named in a superseding indictment unsealed yesterday. They allegedly submitted nearly $300 million in fraudulent claims to Medicare, Medicaid, and private insurers.
Court documents indicate the brothers owned four clinical laboratories in Illinois and California, sometimes hiding their ownership through “straw” buyers. The indictment claims they billed over $293 million for COVID-19 testing services that were never actually provided.
Despite the lack of services, insurers reportedly paid out around $65 million in reimbursements.
Investigators say the brothers laundered the money by moving cash through various businesses they controlled. The funds were then used to purchase luxury vehicles, high-end watches, gold bars, and overseas real estate.
“These defendants are charged with a brazen scheme to steal nearly $300 million from vital health care programs by taking advantage of the fear and panic of the COVID-19 pandemic,” said Acting Assistant Attorney General Matthew R. Galeotti. He noted that the Justice Department is focused on pursuing those who target the elderly and disabled for profit.
FBI Special Agent in Charge Douglas S. DePodesta added that white-collar crimes like this have real-world impacts.
“Health care fraud affects everyone — it costs taxpayers millions of dollars, contributes to rising health insurance premiums, and depletes resources from our vital health care system,” DePodesta said.
Both men face six counts of health care fraud and one count of money laundering conspiracy. Sufyan Feroze faces an additional count for engaging in a monetary transaction with criminally derived property exceeding $10,000.
If convicted, each count of health care fraud carries a maximum of 10 years in prison, while the money laundering conspiracy charge carries up to 20 years.
The FBI and the Department of Health and Human Services Office of Inspector General (HHS-OIG) led the investigation.
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