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FIRST ON FOX: Two men were sentenced Monday on charges related to masterminding a $522 million fraud scheme that targeted Medicare, Medicaid and private insurance companies — using criminals, fraudulent orders and DNA samples collected from patients across the country.
Reyad Salahaldeen, 57, of Buford, Georgia, was sentenced to 12 years and 7 months in prison after pleading guilty to conspiracy to commit wire fraud and wire fraud. Mohammad Mustafa, 28, of Duluth, Georgia, was sentenced to three years in prison after pleading guilty to making illegal health care payments, according to the Department of Justice.
“Under the guise of medical care, these two fraudsters attempted to steal more than half a billion dollars from taxpayers,” the Department of Justice said.
Federal prosecutors say the scheme led to an estimated $84 million in payments to Medicare, Medicaid and private insurance companies, highlighting the extent of the fraud authorities say is gutting taxpayer-funded health plans and driving a wide-ranging government crackdown.
Reyad Salahaldeen, 57, of Buford, Georgia, was sentenced to prison after pleading guilty to conspiracy to commit wire fraud and wire fraud. (DOJ)
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The program relied on a network of marketers who targeted individuals – many covered by Medicare – and persuaded them to get genetic tests by advertising them as free or important medical tests, including cancer risk.
Prosecutors said the tests are often not medically necessary and are ordered by medical providers who have not treated patients and do not use the results in their care.
That allowed the labs to bill government health programs for expensive tests that wouldn’t otherwise be approved, officials said.
Both men were ordered to pay substantial fines. Salahaldeen was ordered to pay more than $84.5 million, while Mustafa must pay more than $64.3 million.
Salahaldeen was also ordered to forfeit more than $3 million in bank accounts, as well as a 2019 GMC Yukon and properties in Texas and Georgia.
Mustafa was born in the United States, while Salahaldeen is a Palestinian who became a legal citizen in 2004, according to officials.
The program began in 2018 and ran through August 2020 and used a network of marketers to make telemarketing calls, door-to-door visits and health fairs to collect DNA samples and insurance information from patients.
Court documents say Salahaldeen controlled multiple laboratories throughout New Jersey, Georgia and Texas, including Express Diagnostics and BioConfirm Laboratories.
Prosecutors said dealers were paid illegal bribes to obtain orders for genetic tests from medical providers who did not treat the patients and did not use the results in their care.
Authorities said Salahaldeen falsified application forms, medical necessity letters and other records to make the test appear legitimate.
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Mustafa, who jointly controlled other laboratories, helped run the scheme by paying fees and creating fake contracts and invoices to disguise illegal payments as legitimate sales services.
In total, the labs billed about $522 million in fraudulent claims. State health plans and private insurance companies paid about $84 million, officials said.
Authorities say Salahaldeen tried to evade arrest after learning of the charges, traveling from North Carolina to Texas and attempting to cross into Mexico using someone else’s ID before being apprehended at the border.
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Government officials say many of the major programs no longer stand alone – but are run by organized networks that connect many states.
The program began in 2018 and runs through August 2020 and relies on a network of salespeople using telemarketing calls, door-to-door visits and health fairs to collect DNA samples and insurance information from patients. (DOJ)
Authorities have identified major cases in recent years, including a COVID-19-era fraud scheme in Minnesota that prosecutors say embezzled more than $240 million in state child support funds.
That case, known as Feeding Our Future, has led to numerous convictions and sentences of up to 28 years in prison.
Prosecutors say the scheme relied on non-profit shell operations, falsified food counts and falsified records — tactics similar to those used in the genetic test fraud case.
Two men were sentenced Monday for masterminding a $522 million fraud scheme targeting Medicare, Medicaid and private insurance companies. (iStock/Getty Images)
This case is part of a broader crackdown on health care fraud. Eleven other accomplices – including advertisers, nurses and doctors – have been convicted, receiving penalties ranging from probation to four years in prison.
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Justice Department officials said the case reflects a strong anti-fraud effort under Trump’s Anti-Fraud Task Force, which is led by Vice President JD Vance.
Since 2007, the DOJ’s Health Care Fraud Strike Force Program has charged more than 6,200 defendants with more than $45 billion in fraud, according to the department.
Salahaldeen and Mustafa’s lawyer details were not available.
